Labor Demand During the COVID-19 Crisis in Norway: Evidence From Vacancy Posting Data

Abstract

We use the vacancy posting data from the Norwegian Labour and Welfare Administration (NAV) job database to study the impact of Covid-19 crisis on labor demand in Norway. We find that in response to the Covid-19 pandemic, the vacancy posting from late February to the end of June in 2020 declined by around 27% relative to the same period in 2019. There are some weak sign of recovery in May and June but the number is still lower than that of the same period last year. The deterioration in labor demand is rather broad. The vacancy postings collapsed around the same time in all counties in Norway. Almost all industry and occupations experienced sizable drops, regardless whether they are considered to be feasible to be performed remotely. Around 80% of the collapse in job creation can be due to the hiring freezes at the firm level.

Keywords: Covid-19, Labor demand, Vacancy postings, Job creation, Norway

JEL Classification: J23, J61, J63