Rescuing a `Sick' Labour Market: Using Online Vacancy Data to Track COVID-19's Economic Impact.

Lead Research Organisation: University of Warwick
Department Name: Economics


The outbreak of COVID-19 pandemic is likely to cause the worst recession the world economy has experienced since the Great Depression. Millions of people have already lost their jobs, and the functioning of the labour market has been profoundly disrupted by social distancing measures. In this context, it is fundamental to quantify the impact of the pandemic on job creation. This project will use a unique data set of daily online job postings to provide answers to key questions: which firms and sectors are expanding or contracting during the pandemic? Which jobs are being demanded? What skills and tasks are required in these jobs and how are work activities being delivered? How fast will the dynamics of job creation change as lockdown measures are eased? To answer these questions, our project will carry out an articulated analysis, employing multiple econometric techniques.

Firstly, we will provide a detailed descriptive analysis on the evolution of job creation across occupations, sectors, and regions in order to deliver essential insights on the economic consequences of the pandemic, including the crucial distributive impacts across regions and types of jobs.

Second, we will make use of advanced techniques in text analysis to study the wording of job postings in order to shed light on whether and how the structure of jobs changes as a result of the COVID-19 shock. In light of the intensity of the COVID-19 induced economic disruption, we may expect to see persistent structural changes to the design of work activities and the remuneration patterns associated with different jobs. The granular and high frequency data that we will employ will allow us to comprehensively assess the occurrence and importance of such changes.

Finally, we plan to identify the firm-level characteristics that play a crucial role in ensuring firms' production continuity, and labour demand resilience. Among other factors, the degree of automated work may be crucial to ensure firms' production continuity under lockdown restrictions. For example, robots assembling product components or production processes that are compatible with remote work may allow firms to remain more active while social distancing measures are in place.

Coupled with a detailed analysis on the skills demanded, the study will be provide essential inputs for the design and roll-out of targeted interventions that support the most severely affected areas, jobs and industries. These inputs will also be useful for the informing longer run investment decisions on skill training programs and government assistance.


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Description The final working paper outputs are still in progress. However, so far the work has proceeded in two phases, with the third phase being finalised

1/. First, we provided an understanding the labour demand impacts of the pandemic in its early period. This is represented by our article "A Tale of Two Crises: The Covid-19 Pandemic versus the Great Recession". This established the basic patterns of labour demand changes in the early 2020 part of the pandemic. In short, there were general and occupation-specific shifts in labour demand. We identified the reallocation of jobs across sectors and occupations as the key issue for the next phase of the pandemic's impact.

2/. In this phase, we follow up on the reallocation issue as more data became available in 2021. Our findings are represented in the book chapter "Remote Work and the post-Pandemic Labour Market" in the CAGE policy report. The main new finding we identified here was a slow recovery of labour demand for direct office-related administrative jobs. This raises the possibility of some displacement risk emerging for office support workers as employers adopt remote working on an ongoing basis and

3/. In our final phase we assess the extent to which the rise of remote working is associated with structural changes in labour demand. Importantly, we find that there has been minimal substitution between occupations as remote working has increased. That is, there are no occupational classes that 'replaced' with positions that are instrinsically more remote friendly. A summary of the work can be found at the slide pack at this address:
Exploitation Route In progress - check PI and CAGE websites for updates. Material for two papers and two policy briefs has been produced and write-up of the working papers is anticipated for April/May 2022.
Sectors Creative Economy,Leisure Activities, including Sports, Recreation and Tourism,Government, Democracy and Justice

Description Advantage magazine: Spring 2021 
Form Of Engagement Activity A magazine, newsletter or online publication
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Professional Practitioners
Results and Impact Our bi-annual advantage magazine translates complex economics research for a general audience. The purpose of the activity is to showcase our research to non-academics, including policymakers and journalists. Journalists often pick up some of our articles for discussion in the broadsheet newspapers. Our magazine has also brought about new collaborations and requests for participation in new activities.

This issue launched our new Public Policy and Data Theme
Year(s) Of Engagement Activity 2021
Description ESRC Festival of Social Science 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Policymakers/politicians
Results and Impact How fast will economic activity rebound and have some types of work suffered a permanent reduction? To what extent will remote working practices continue? In this webinar, join Professor Mirko Draca (CAGE Director, Department of Economics, University of Warwick) as he reports on new research using 'real-time' data that looks at the economic impacts of the Covid-19 crisis in the UK. Using daily online job vacancy data to measure the state of the labour market as well as structural changes in the nature of jobs, our analysis of real-time data allows us to address these questions with a specific focus on conditions around Coventry and the West Midlands.
Year(s) Of Engagement Activity 2020