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Effects of the Covid-19 Pandemic on the Colombian Labor Market: Disentangling the Effect of Sector-Specific Mobility Restrictions

Author

Listed:
  • Leonardo Fabio Morales

    (Banco de la República de Colombia)

  • Leonardo Bonilla-Mejía

    (Banco de la República de Colombia)

  • Jose Pulido

    (Banco de la República de Colombia)

  • Luz A. Flórez

    (Banco de la República de Colombia)

  • Didier Hermida

    (Banco de la República de Colombia)

  • Karen L. Pulido-Mahecha

    (Banco de la República de Colombia)

  • Francisco Lasso-Valderrama

    (Banco de la República de Colombia)

Abstract

We assess the effect of the Covid-19 pandemic and the lockdown of some economic sectors on the Colombian labor market. We exploit the variation between excluded and non-excluded sectors from the lockdown, as well as the timing of the restriction policies, to identify the effect of sector-specific restriction policies. These restrictions had negative effects on employment, accounting for approximately a quarter of the total job loss between February and April of 2020; the remaining three quarters of the job losses could be attributed to the regional patterns of the disease spread, and other epidemiological and economic factors affecting the whole country during this period. Therefore, we should expect important employment losses even in the absence of such restrictions. In contrast, we find no significant effect of sector-specific restrictions on average worked hours or wages, indicating that most of the adjustment of the labor market took place in the extensive margin. Moreover, sectorspecific restrictions only affect salaried workers, while self-employment is more responsive to the disease spread. **** RESUMEN: En este trabajo evaluamos el efecto de la pandemia de Covid-19 y las restricciones de movilidad sectoriales en el mercado laboral colombiano. Para identificar el efecto de estas políticas, explotamos la variación en el empleo y salarios en los sectores excluidos y no excluidos de las restricciones a la movilidad, así como el momento de su implementación. Las restricciones sectoriales a la movilidad tienen efectos negativos en el empleo, representando aproximadamente una cuarta parte de la pérdida total de empleo entre febrero y abril de 2020. Los patrones regionales de propagación de la enfermedad y otros componentes epidemiológicos y económicos, que afectaron al país durante este período, representan las tres cuartas partes restantes de la pérdida de empleos. Por lo tanto, debemos esperar importantes pérdidas de empleo incluso en ausencia de dichas restricciones. No encontramos un efecto significativo en el promedio de horas trabajadas o los salarios, lo que indica que la mayor parte del ajuste del mercado laboral tuvo lugar en el margen extensivo (empleos). Además, las restricciones a la movilidad sectoriales afectan principalmente a los trabajadores asalariados, mientras que el trabajo por cuenta propia responde principalmente a la propagación de la enfermedad.

Suggested Citation

  • Leonardo Fabio Morales & Leonardo Bonilla-Mejía & Jose Pulido & Luz A. Flórez & Didier Hermida & Karen L. Pulido-Mahecha & Francisco Lasso-Valderrama, 2020. "Effects of the Covid-19 Pandemic on the Colombian Labor Market: Disentangling the Effect of Sector-Specific Mobility Restrictions," Borradores de Economia 1129, Banco de la Republica de Colombia.
    • Handle: RePEc:bdr:borrec:1129
    DOI: https://doi.org/10.32468/be.1129
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    Cited by:

    1. Jhon James Mora, 2021. "Analysis of Unemployment and Employment After a Strict COVID-19 Confinement Policy in Cali," Lecturas de Economía, Universidad de Antioquia, Departamento de Economía, issue 94, pages 165-193, Enero-Jun.
    2. Leonardo Bonilla-Mejía & Luz A. Florez & Didier Hermida & Francisco Lasso & Leonardo Fabio Morales & Juan Jose Ospina & José Pulido, 2023. "Is the COVID-19 Pandemic Fast-Tracking Automation in Developing Countries? Evidence from Colombia," Journal of Human Capital, University of Chicago Press, vol. 17(4), pages 593-616.
    3. Leonardo Bonilla-Mejía & Mauricio Villamizar-Villegas, 2022. "The Leading Role of Bank Supply Shocks," Borradores de Economia 1205, Banco de la Republica de Colombia.
    4. Clotilde Mahe & Sergio Parra-Cely, 2020. "Isolating the incapacitative effect of social distancing on crime: Evidence from Ecuador’s Covid-19 lockdown," DEM Discussion Paper Series 20-23, Department of Economics at the University of Luxembourg.
    5. Cepparulo, Brian & Jump, Robert Calvert, 2022. "The impact of Covid-19 restrictions on economic activity: evidence from the Italian regional system," Greenwich Papers in Political Economy 37801, University of Greenwich, Greenwich Political Economy Research Centre.
    6. Leonardo Bonilla-Mejía & Juan Esteban Carranza & Mariana Fuentes Vélez & Felipe González Esquivel & Stiven Pérez Pulgarín & Mauricio Villamizar-Villegas, 2022. "Covid-19 y consumo de los hogares: hechos estilizados a partir de datos del Grupo Éxito," Chapters, in: Darwin Cortés Cortés & Christian Posso & Mauricio Villamizar-Villegas & Banco de la República & Univ (ed.), Covid-19 consecuencias y desafíos en la economía colombiana. Una mirada desde las universidades, chapter 9, pages 173-192, Banco de la Republica de Colombia.
    7. 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.
    8. Karen García-Rojas & Paula Herrera-Idárraga & Leonardo Fabio Morales & Natalia Ramírez-Bustamante & Ana María Tribín-Uribe, 2020. "(She)cession: The Colombian female staircase fall," Borradores de Economia 1140, Banco de la Republica de Colombia.

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    Keywords

    Covid-19; mobility restrictions; labor market; employment; Covid-19; mobility restrictions; labor market; employment.;
    All these keywords.

    JEL classification:

    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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