Corporate Hiring under COVID-19: Labor Market Concentration, Downskilling, and Income Inequality
45 Pages Posted: 11 May 2020 Last revised: 12 May 2020
Date Written: May 8, 2020
Big data on job-vacancy postings reveal several dimensions of the impact of COVID-19 on the U.S. job market. Firms have cut back on postings for high-skill jobs more than for low-skill jobs, with small firms nearly halting their new hiring altogether. New-hiring cuts and downskilling are most pronounced in local labor markets lacking depth (where employment is concentrated within a few firms), in low-income areas, and in areas with greater income inequality. Cuts are deeper in industries where workers are more unionized and in the non-tradable sector. Access to finance modulates corporate hiring, with credit-constrained firms curtailing their job postings the most. Our study shows how the early-2020 global pandemic is shaping the dynamics of hiring, identifying the firms, jobs, places, industries, and labor markets most affected by it. Our results point to important challenges to the scale and speed of a recovery.
Keywords: COVID-19, Corporate hiring, Human capital, Skilled labor, Credit access
JEL Classification: E24, J23, G31
Suggested Citation: Suggested Citation