Crisis Response Monitoring

Last updated: June 3, 2020, 18:05

Economic and social disruptions caused by the COVID-19 pandemic may have lasting effects on employment, income and working conditions. At the same time, there are significant cross-country differences in the labor market and social policy responses that are deployed to help mitigate the imminent crisis effects. IZA closely monitors these developments in a joint effort with a small number of selected labor economists as country experts. First reports are now available (see below).

Policy responses by country

Income support to sick workers and their families
Income support to quarantined workers who cannot work from home
Helping dealing with unforeseen care needs
Income support to persons losing their jobs or self-​employment income
Helping firms to adjust working time and preserve jobs
Financial support to firms affected by a drop in demand
Changes to dismissal regulation
Helping economically insecure workers stay in their homes

Source: OECD, as reported June 1, 2020

Cumulated deaths per 1 Mio inhabitants

Source: Blavatnik School of Government, as reported June 2, 2020

As of today, up-to-date crisis-​response policy inventories and general recommendations to combat the labor market and social impact of COVID-19 have become available (e.g., by the OECD). Short-run objectives of various policy responses are predominantly income and employment stabilization (often at the same time reducing activation measures), while temporarily detaching income from work and economic activities. In some countries, these responses rely to a larger extent on automatic stabilizers, while the amount of discretionary measures is generally large and often unprecedented.

IZA has invited a small number of labor economists as country experts to jointly monitor the crisis responses. Their expertise is an extremely valuable addition to existing policy inventories. Based on a qualitative survey among these country experts, IZA establishes an independent assessment of actual crisis-related policy responses. This assessment focuses on the various domains in which measures can be observed and analyzes their targeting, take-up and implementation. Furthermore, the country experts point to blind spots and help identifying policy innovations to revive labor market activities at the next stage.

The qualitative survey among country experts is based on a set of eight questions (see right column) and covers a sample of European and G7 countries heavily affected by COVID-19 as well as the EU. The first wave of this survey takes place in in May 2020. Three subsequent waves are planned.

The initial crisis management report, to be released in early June 2020, will include short up-to-date country chapters, a review of EU-level activities and a comparative assessment prepared by the local team of IZA researchers in Bonn.

Preliminary country reports include the following:

AUSTRIA
FRANCE
GERMANY
ITALY
NETHERLANDS
PORTUGAL
SPAIN
SWEDEN
SWITZERLAND
UNITED KINGDOM
USA

Expert Survey Questionnaire

How do you asses the current impact of COVID-19 on the labor market in your country in terms of employment, unemployment, sectors, and firms? Who is affected the most? What do you see in terms of sectoral employment reactions, and regarding permanent, fixed-term or agency workers? Are current figures and estimates more or less in line with earlier forecasts or are there some unexpected or even surprising deviations?

What is the general orientation and targeting of the measures adopted to tackle the labor market impact of COVID-19 in your country? Is the summary in the OECD inventory appropriate? Have there been recent changes or new initiatives? How do you assess the overall policy set adopted so far? Have certain aspects or target groups been neglected in the policy packages adopted?

Regarding policies providing immediate liquidity to bussinesses in your country: How do you see the actual take-up of these support measures, also by small firms, self-employed and freelancers? To what extent do the measures in practice help mitigate the economic impact of COVID-19? How do you see the delivery and implementation by public agencies and other entities, taking into account the trade-off between quick delivery and deadweight losses or misallocation?

Regarding dependent workers in your country: How do you assess the effectiveness of unemployment insurance and short-time work in stabilizing income and jobs at the moment? To what extent do short-time work measures help reduce or postpone inflows into unemployment (and for whom)? Is this being complemented by sectoral or firm-level agreements? What is known about the support delivered to job seekers now? Has activation by active labor market policies come to a halt?

To what extent are working conditions and work organization within firms in your country changing at the moment, in particular in sectors where there is an increased or normal workload? How do working time rules, mobile working rules, or care arrangements respond to that in practice?

How do you assess the situation of new labor market entrants in your country in this year, in particular the situation of school or university graduates? Are there policy innovations and initiatives to cope with this particular situation regarding hiring, provision of apprenticeships etc.?

Do you see further remarkable developments and issues in your country, e.g. unexpected policy innovations, changes in employment, new trends? Can you already identify (changes in) medium-term or long-term trends on the labor market that are due to the crisis (e.g. accelerated structural change)? How will the general functioning of the labor market be affected in the long run?

Can the current policy stance (reduced economic activity, combined with public income support) be sustained in your country, and for how long? What do you see as necessary and useful next steps, in particular to revive economic activities (soon)? How do you see the current and future fiscal viability of the crisis relief measures?

Restrictions on public life by country

Schools
Workplaces
Public events
Unrestricted gatherings
Outdoor activities
Public transport
Domestic travel
International travel

Source: Blavatnik School of Government, as reported June 2, 2020