The us labor market during the beginning of the pandemic recession

Tomaz Cajner, Leland D. Crane, Ryan A. Decker, John Grigsby, Adrian Hamins-Puertolas, Erik Hurst, Christopher Kurz, Ahu Yildirmaz

Research output: Contribution to journalArticlepeer-review

32 Scopus citations

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.

Original languageEnglish (US)
Pages (from-to)3-33
Number of pages31
JournalBrookings Papers on Economic Activity
Volume2020
Issue numberSpecial Edition
DOIs
StatePublished - 2020
Externally publishedYes

All Science Journal Classification (ASJC) codes

  • General Business, Management and Accounting
  • Economics and Econometrics

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