Abstract
We investigate how the economic consequences of the pandemic, and of the government-mandated measures to contain its spread, affected the self-employed relative to employed individuals in Germany and, secondly, to what extent the female self-employed were more strongly hit than their male counterparts. For our analysis, we use representative, real-time survey data where respondents are asked about their situation during the COVID-19 pandemic. Our findings indicate that self-employed individuals were much more likely to suffer income losses than employees. Among the self-employed, women were 35% more likely to experience income losses than men, as women are disproportionately working in industries that are more severely affected by the COVID-19 pandemic. We conclude that future policy measures intended to mitigate such shocks should account for this variation in economic hardship.
Highlights
The unprecedented shutdown of businesses in specific industries, social distancing guidelines, and overall insecurity caused by the COVID-19 pandemic resulted in the temporary halt of major parts of the economy in many countries in 2020, with dire consequences for these economies (Milani, 2021)
Our findings indicate that among the self-employed, who generally face a higher likelihood of income losses due to COVID-19 than employees, women are 35% more likely to experience income losses than their male counterparts
Our results further suggest that the gender gap among the self-employed is largely explained by the fact that women disproportionately work in industries that are more severely affected by the COVID-19 pandemic
Summary
The unprecedented shutdown of businesses in specific industries, social distancing guidelines, and overall insecurity caused by the COVID-19 pandemic resulted in the temporary halt of major parts of the economy in many countries in 2020, with dire consequences for these economies (Milani, 2021). The authors do not find gender differences in realized job or earnings losses for Germany While they provide important initial evidence, they do not distinguish between self-employed individuals and employees with respect to the gender gap. This is an important distinction since the labor market in Germany is characterized by stronger rigidities than other countries, limiting the extent to which firms can cut the wages of their employees These are restricted by limited data due to the historic nature of the event In this context, our finding that NPIs have unintended consequences for gender equality implies that this variation in economic suffering needs to be accounted for when addressing the ongoing COVID-19 pandemic or any future public health crisis involving communicable diseases of a similar or even greater magnitude
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