Corporate Hiring under COVID-19: Worker Downskilling, Job Flexibility, and Income Inequality

59 Pages Posted: 11 May 2020 Last revised: 15 Sep 2020

See all articles by Murillo Campello

Murillo Campello

Cornell University - Samuel Curtis Johnson Graduate School of Management; National Bureau of Economic Research (NBER)

Gaurav Kankanhalli

University of Pittsburgh - Katz Graduate School of Business

Pradeep Muthukrishnan

Cornell University, Samuel Curtis Johnson Graduate School of Management, Department of Finance

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Date Written: May 8, 2020

Abstract

Big data on job vacancy postings reveal multiple facets of the impact of Covid-19 on the U.S. job market. Firms have disproportionately cut on hiring for high-skill jobs (downskilling), with small firms nearly halting their hiring altogether. New-hiring cuts and downskilling are most pronounced in labor markets where employment is concentrated within a few firms, in low-income areas, and in areas with greater income inequality. Access to finance modulates corporate hiring, with credit-constrained firms curtailing their high-skill postings the most. Applying machine learning techniques to job ads, we show that firms have skewed their new hiring towards operationally core positions. New positions also display greater flexibility regarding schedules, tasks, and requirements. A "time-to-fill" measure reveals that high-skill job openings remain active for longer in the pandemic, while posting duration drops for low-skill jobs. Our study shows how the 2020 global pandemic shaped the dynamics of hiring, identifying the firms, jobs, places, industries, and labor markets most affected by it.

Keywords: COVID-19, Corporate hiring, Human capital, Skilled labor, Credit access

JEL Classification: E24, J23, G31

Suggested Citation

Campello, Murillo and Kankanhalli, Gaurav and Muthukrishnan, Pradeep, Corporate Hiring under COVID-19: Worker Downskilling, Job Flexibility, and Income Inequality (May 8, 2020). Available at SSRN: https://ssrn.com/abstract=3596655 or http://dx.doi.org/10.2139/ssrn.3596655

Murillo Campello

Cornell University - Samuel Curtis Johnson Graduate School of Management ( email )

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Ithaca, NY 14853
United States

HOME PAGE: http://www.johnson.cornell.edu/Faculty-And-Research/Profile.aspx?id=mnc35

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138

Gaurav Kankanhalli (Contact Author)

University of Pittsburgh - Katz Graduate School of Business ( email )

Pittsburgh, PA 15260
United States

Pradeep Muthukrishnan

Cornell University, Samuel Curtis Johnson Graduate School of Management, Department of Finance ( email )

Ithaca, NY
United States

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