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COVID-19: how much unemployment was caused by the shutdown in Germany?

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  • Anja Bauer
  • Enzo Weber

Abstract

This paper evaluates the short-term labour market impact of the COVID-19 containment measures in Germany. By assessing the treatment effect on unemployment via difference-in-difference estimation, we find that 60% of the considerably increased inflows from employment into unemployment in April 2020 were due to the shutdown measures. Disentangling further, we find that the hiring margin accounted for additional 82% of the unemployment effect coming from the separations margin. In sum, the shutdown measures increased unemployment in the short run by 117,000 persons.

Suggested Citation

  • Anja Bauer & Enzo Weber, 2021. "COVID-19: how much unemployment was caused by the shutdown in Germany?," Applied Economics Letters, Taylor & Francis Journals, vol. 28(12), pages 1053-1058, July.
    • Handle: RePEc:taf:apeclt:v:28:y:2021:i:12:p:1053-1058
    DOI: 10.1080/13504851.2020.1789544
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    Cited by:

    1. Arceo-Gomez, Eva O. & Campos-Vazquez, Raymundo M. & Esquivel, Gerardo & Alcaraz, Eduardo & Martinez, Luis A. & Lopez, Norma G., 2023. "The impact of COVID-19 infection on labor outcomes of Mexican formal workers," World Development Perspectives, Elsevier, vol. 29(C).
    2. Serra, Laura & Silva, José I. & Vall-llosera, Laura, 2022. "The unemployment effects of closing non-essential activities during the COVID-19 lockdown: The Spanish municipalities," Economic Analysis and Policy, Elsevier, vol. 76(C), pages 806-819.
    3. Hugo S. Gonçalves & Sérgio Moro, 2023. "On the economic impacts of COVID‐19: A text mining literature analysis," Review of Development Economics, Wiley Blackwell, vol. 27(1), pages 375-394, February.
    4. Toledo Wilfredo, 2021. "Covid-19 and Unemployment: Evidence from Puerto Rico Using Bayesian Analyses with High-Frequency Data," Economics and Business, Sciendo, vol. 35(1), pages 174-189, January.
    5. Trang, Luong & Birur, Dileep & Lal, Pankaj, 2022. "Charting the Global Economic Recovery from COVID-19 Vaccinations," Conference papers 333403, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    6. Cuestas Juan Carlos & Ordóñez Javier & Monfort Mercedes, 2021. "Measuring the Cost of Covid-19 in Terms of the Rise in the Unemployment Rate: The Case of Spain," Economics - The Open-Access, Open-Assessment Journal, De Gruyter, vol. 15(1), pages 112-114, January.
    7. Cochrane, William & Poot, Jacques & Roskruge, Matthew, 2022. "Urban Resilience and Social Security Uptake: New Zealand Evidence from the Global Financial Crisis and the COVID-19 Pandemic," IZA Discussion Papers 15510, Institute of Labor Economics (IZA).
    8. Jianwei Huang & Mei-Po Kwan, 2022. "Examining the Influence of Housing Conditions and Daily Greenspace Exposure on People’s Perceived COVID-19 Risk and Distress," IJERPH, MDPI, vol. 19(14), pages 1-19, July.
    9. Felix Roth & Lars Jonung & Aisada Most, 2024. "COVID-19 and public support for the Euro," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 51(1), pages 61-86, February.
    10. Deng, Tianjie & Xu, Tracy & Lee, Young Jin, 2022. "Policy responses to COVID-19 and stock market reactions - An international evidence," Journal of Economics and Business, Elsevier, vol. 119(C).
    11. Tehila Refaeli & Michal Krumer-Nevo, 2021. "Mental Distress during the Coronavirus Pandemic in Israel: Who Are the Most Vulnerable?," IJERPH, MDPI, vol. 19(1), pages 1-13, December.
    12. Katarina Kramarova & Lucia Svabova & Barbora Gabrikova, 2022. "Impacts of the Covid-19 crisis on unemployment in Slovakia: a statistically created counterfactual approach using the time series analysis," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 17(2), pages 343-389, June.
    13. Benjamin Küfner & Joseph W. Sakshaug & Stefan Zins, 2022. "Establishment survey participation during the COVID-19 pandemic," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 56(1), pages 1-18, December.
    14. Gordon Betcherman & Nicholas Giannakopoulos & Ioannis Laliotis & Ioanna Pantelaiou & Mauro Testaverde & Giannis Tzimas, 2023. "The short-term impact of the 2020 pandemic lockdown on employment in Greece," Empirical Economics, Springer, vol. 65(3), pages 1273-1307, September.
    15. Grace Armijos-Bravo & Segundo Camino-Mogro, 2023. "Covid-19 Lockdown in Ecuador: Are there Gender Differences in Unemployment?," Journal of Development Studies, Taylor & Francis Journals, vol. 59(6), pages 833-853, June.

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