The US Labor Market during the Beginning of the Pandemic Recession

By Tomaz Cajner, Leland D. Crane, Ryan A. Decker, J. Grigsby, Adrian Hamins-Puertolas, Erik G. Hurst, C. Kurz, Ahu Yildirmaz. Brookings Papers on Economic Activity, 2020

337 citations recorded by the source corpus.

ABSTRACT:Using weekly administrative payroll data from the largest US payroll processing company, we measure the evolution of the US labor market during the first four months of the global COVID-19 pandemic. After aggregate employment fell by 21 percent through late April, employment rebounded somewhat through late June. The reopening of temporarily shuttered businesses contributed significantly to the employment rebound, particularly for smaller businesses. We show that worker recall has been an important component of recent employment gains for both reopening and continuing businesses. Employment losses have been concentrated disproportionately among lower wage workers; as of late June employment for workers in the lowest wage quintile was still 20 percent lower relative to mid-February levels. As a result, average base wages increased between February and June, though this increase arose entirely through a composition effect. Finally, we document that businesses have cut nominal wages for almost 7 million workers while forgoing regularly scheduled wage increases for many others.

Subfields: Economics and Econometrics, General Health Professions, Modeling and Simulation

View Paper: https://www.semanticscholar.org/paper/4fee3d0cef0d9a17ce1b9b7d155862c76eb421d5

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Citations in the corpus

The impact of COVID-19 on small business outcomes and expectations (2020, background): “(15) finds that employment declined, on average, 27% for firms with less than 500 employees and about 28% for firms with less than 50 employees between mid-February and mid-April.”
Job search during the COVID-19 crisis (2020, neutral): “, 2020), US payroll data (Cajner et al., 2020), household surveys (Adams-Prassl et al.”
This Time It's Different: The Role of Women's Employment in a Pandemic Recession (2020, methodology): “Cajner et al. (2020) come to similar conclusions using data from a major payroll processing company, which show a 21.5 percent decrease in women’s employment from February to April 2020, compared to a 17.8 percent decrease for men.”
The Adverse Effect of the COVID-19 Labor Market Shock on Immigrant Employment (2020, neutral): “See Cajner et al (2020) for a study in the American context and Von Gaudacker et al (2020) for an examination of the Netherlands experience.”
Sheltering in place and domestic violence: Evidence from calls for service during COVID-19 (2020, neutral): “Tens of millions of workers lost jobs or worked fewer hours (Cajner et al., 2020; Coibion et al., 2020; Cowan, 2020), and demand for new workers fell nearly 30% (Kahn et al., 2020; Campello et al., 2020).”
The Impacts of COVID-19 on Minority Unemployment: First Evidence from April 2020 CPS Microdata (2020, neutral): “Using payroll data Cajner et al. (2020) find that private sector payrolls shrank by 22 percent in the two-month span from midMarch to mid-April.”
The Impact of COVID-19 on US Firms (2021, background): “These two very different experiences mimic the similar split recession and recovery found by Chetty et al. (2020) and Cajner et al. (2020) in the labor market.”
Effects of the COVID-19 Recession on the US Labor Market: Occupation, Family, and Gender (2021, background): “…partners, and for those couples the optimal response to the increased child supervision needs was for mothers to reduce labor supply.3 In addition, Cajner et al. (2020) show that employment losses were 3 It is hard to test the implications of this hypothesis, given the unavailability of real time…”