The Economic impact of COVID-19 Learning Deficits: A Survey of the Literature

The COVID-19 pandemic has led to a temporary reduction in the quantity and quality of education, with school closures of varying degree implemented across the globe. This paper reviews the literature on learning deficits in compulsory education and their possible economic impact. Studies from different EU Member States show significant learning deficits in primary and secondary education, equivalent to about two months of learning progress during a regular school year on average. The impact of the pandemic on learning outcomes varies widely by country as well as by students’ age. As students with a lower socioeconomic status or weaker previous performance experienced larger learning deficits, inequality in educational achievement has increased between students, schools, and countries. While labour market outcomes of the 2020 graduating cohort seem to be resilient at the current juncture of tight labour markets, the long-term economic impact of learning deficits is likely to be non-negligible. Existing studies project small productivity losses for the coming years but a significant impact in the long term, peaking by the second half of the 21st century, when all affected cohorts of students will have entered the labour market. Estimates of the aggregate real GDP effects of 1-year learning deficits, given the number of affected cohorts of students (corresponding to around one third of the future labour force at the maximum) and assuming that no remedial action is taken and losses are not recovered, reach between –0.5% and –4.7% in 2050 in the contributions surveyed in this paper, compared to a baseline without any learning deficits. For an average learning deficit of circa one fifth of a school year this would translate into real GDP effects between -0.1% and -1% by 2050.