Effects of the COVID-19 pandemic on the Colombian labour market: Disentangling the effect of sector-specific mobility restrictions.

Abstract

We assess the effect of the COVID‐19 pandemic and particularly the sector‐specific mobility restrictions on the Colombian labour market. We exploit the sectoral and temporal variation of the restriction policies to identify their effect. Mobility restrictions significantly reduced employment, accounting for approximately a quarter of the total job loss between February and April of 2020. The remaining three quarters of the job losses could be attributed to the disease's regional patterns and other epidemiological and economic factors affecting the whole country. Therefore, we should expect important employment losses even in the absence of such restrictions. We also assess the effect of restrictions on the intensive margin, finding negative, although smaller effects on the number of hours worked and wages. Most of the employment effect is driven by salaried workers, while self‐employment was more responsive to the disease spread. Finally, we find that women are disproportionally affected: mobility restrictions account for a third of the recent increase of the gender gap in salaried employment.