Measuring the Labor Market at the Onset of the Covid-19 Crisis

53 Pages Posted: 4 Aug 2020 Last revised: 27 Jun 2021

See all articles by Alexander Bartik

Alexander Bartik

University of Illinois at Urbana-Champaign - Department of Economics

Marianne Bertrand

University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Feng Lin

University of Chicago - Department of Economics

Jesse Rothstein

University of California, Berkeley, The Richard & Rhoda Goldman School of Public Policy; University of California, Berkeley, College of Letters & Science, Department of Economics; National Bureau of Economic Research (NBER)

Matthew Unrath

University of California, Berkeley - The Richard & Rhoda Goldman School of Public Policy

Multiple version iconThere are 2 versions of this paper

Date Written: July 2020

Abstract

We use traditional and non-traditional data to measure the collapse and partial recovery of the U.S. labor market from March to early July, contrast this downturn to previous recessions, and provide preliminary evidence on the effects of the policy response. For hourly workers at both small and large businesses, nearly all of the decline in employment occurred between March 14 and 28. It was driven by low-wage services, particularly the retail and leisure and hospitality sectors. A large share of the job losses in small businesses reflected firms that closed entirely, though many subsequently reopened. Firms that were already unhealthy were more likely to close and less likely to reopen, and disadvantaged workers were more likely to be laid off and less likely to return. Most laid off workers expected to be recalled, and this was predictive of rehiring. Shelter-in-place orders drove only a small share of job losses. Last, states that received more small business loans from the Paycheck Protection Program and states with more generous unemployment insurance benefits had milder declines and faster recoveries. We find no evidence that high UI replacement rates drove job losses or slowed rehiring.

Suggested Citation

Bartik, Alexander and Bertrand, Marianne and Lin, Feng and Rothstein, Jesse and Unrath, Matthew, Measuring the Labor Market at the Onset of the Covid-19 Crisis (July 2020). NBER Working Paper No. w27613, Available at SSRN: https://ssrn.com/abstract=3665884

Alexander Bartik (Contact Author)

University of Illinois at Urbana-Champaign - Department of Economics ( email )

410 David Kinley Hall
1407 W. Gregory
Urbana, IL 61801
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Marianne Bertrand

University of Chicago - Booth School of Business ( email )

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Chicago, IL 60637
United States
773-834-5943 (Phone)

HOME PAGE: http://gsbwww.uchicago.edu/fac/marianne.bertrand/vita/cv_0604.pdf

National Bureau of Economic Research (NBER) ( email )

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Centre for Economic Policy Research (CEPR)

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United Kingdom

Feng Lin

University of Chicago - Department of Economics ( email )

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Chicago, IL 60637
United States

Jesse Rothstein

University of California, Berkeley, The Richard & Rhoda Goldman School of Public Policy ( email )

2607 Hearst Avenue
Berkeley, CA 94720-7320
United States

HOME PAGE: http://eml.berkeley.edu/~jrothst

University of California, Berkeley, College of Letters & Science, Department of Economics ( email )

549 Evans Hall #3880
Berkeley, CA 94720-3880
United States

National Bureau of Economic Research (NBER)

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Cambridge, MA 02138
United States

Matthew Unrath

University of California, Berkeley - The Richard & Rhoda Goldman School of Public Policy ( email )

2607 Hearst Avenue
Berkeley, CA 94720-7320
United States

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