Abstract
The impact of the Covid-19 pandemic on the UK labour market has been extremely heterogeneous, with strong variation both by occupation and industrial sector. The extent to which workers adjust their job search behaviour in response to this reallocation of employment has an important bearing on the future course of the labour market. At an aggregate level we see evidence consistent with search responding to changes to the state of the economy. In particular, changes to job search by employees are closely linked to changes in vacancies, and we also see ows from unemployment to inactivity peak at the same time as vacancies bottom-out.A key novelty in this paper is that we can additionally see whether the link between job search and changing employment patterns holds at a micro level, using the COVID supplement of the UK Household Longitudinal Survey, which shows the industries and occupations targeted by job searchers. The vast majority of job searchers target growing occupations and industries, which suggests job searchers are responding to conditions at a micro as well as macro level. This is also suggested by the fact that job searchers who were in occupations that expanded in the pandemic seek to switch occupations less frequently than those in shrinking occupations.
Highlights
This paper takes stock of the labour market impacts of the Covid-19 pandemic with a focus on search and reallocation across industries and occupations
We know from past recession shocks that labour market participants can carry the scars from economic shocks for large portions of their future careers.3. Avoiding such scarring depends crucially on understanding which sectors, occupations and groups of workers have been disproportionately hit by the shock, how workers are searching for new jobs during the recovery, and how this process interacts with longer-term trends in the labour market
The introduction of the Job Retention Scheme (JRS) has subdued the rise in employment-to-unemployment transitions relative to the Great Recession, the employment rate fell by a similar amount due to a rise in transitions from employment to inactivity
Summary
Any opinions expressed in this paper are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but IZA takes no institutional policy positions. The IZA Institute of Labor Economics is an independent economic research institute that conducts research in labor economics and offers evidence-based policy advice on labor market issues. Supported by the Deutsche Post Foundation, IZA runs the world’s largest network of economists, whose research aims to provide answers to the global labor market challenges of our time. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author
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