Gaurav Khanna, Wenquan Liang, Ahmed Mushfiq Mobarak, Ran Song, 08 April 2021

Why do workers remain in low-productivity areas when they could experience wage gains elsewhere? While the literature has proposed a few explanations, including the high cost and risky nature of migration, this column uses the case of China to examine instead the role that pollution plays. It finds that severe pollution can induce workers to relocate from productive to unproductive regions, suggesting that pollution control, coupled with policies facilitating migration, has the potential to bring about extra economic gains in developing countries.

Stefan Pichler, Katherine Wen, Nicolas Robert Ziebarth, 05 March 2021

By now, it should be clear that presenteeism (going into work when sick) contributes significantly to the transmission of diseases. This column summarises current evidence on sick-pay mandates in the US and the spread of flu-like illnesses and COVID-19. Over the last ten years, states that introduced sick-pay mandates saw a decrease in seasonal flu activity by up to 30% in the first years compared to states that didn’t introduce such mandates. Introducing sick-pay mandates did not result in significant employment or wages decreases. Mandating COVID-19-related emergency sick leave also significantly reduced COVID-19 infection rates in states previously without sick-pay mandates, especially affecting low-income and service-sector employees.

Olivier Marie, Judit Vall Castello, 28 July 2020

Many governments increased temporary sick-leave benefits in the wake of COVID-19, but the benefits are due to expire after a certain time. This column looks back at a 2012 policy change in Spain which radically altered the generosity of paid sick leave available to public-sector employees. Following the change, the number of sick leaves taken by public-sector workers dropped 29% but the likelihood of relapses increased, with most of it driven by infectious disease relapses. Policymakers need to manage changes in sick-leave generosity, especially in the face of persistent or recurring infectious diseases such as COVID-19.

Stefan Thewissen, Duncan MacDonald, Christopher Prinz, Maëlle Stricot, 08 July 2020

Paid sick leave is an important policy for protecting workers and their communities during a pandemic, serving not only to preserve jobs and incomes but also to contain the spread of the virus. This column examines how different countries implemented paid sick leave during the COVID-19 crisis. Evidence suggests such policies will facilitate an orderly end to lockdowns – and sustain workers during subsequent waves of infection – but only if temporary extensions are kept in place and broadened to include those workers currently denied coverage.

Orsetta Causa, Maria Chiara Cavalleri, 30 June 2020

The Covid-19 pandemic risks exacerbating existing inequalities. This column analyses distributional aspects of the crisis by focusing on non-standard workers, whose limited access to social protection and job retention schemes make them particularly vulnerable to labour market disruptions. The authors discuss which policy actions governments have taken thus far and which policies they can pursue further in order to support vulnerable workers and avert the risk of a pandemic inequality feedback loop.

Uri Alon, Eran Yashiv, 27 April 2020

Countries are facing stark choices between ending the lockdown to revive people’s lives and risking the ravages of the COVID-19 pandemic. This column proposes an exit strategy from lockdown based on a vulnerability in the coronavirus transmission mechanism, i.e. the latent period in which most infected people do not infect others. An optimal work/lockdown cycle based on this weak spot could minimise infection risks while greatly improving the painful trade-offs faced by policymakers.

Teresa Barbieri, Gaetano Basso, Sergio Scicchitano, 27 April 2020

Many countries are now designing exit strategies from the sectoral lockdowns put in place to contain the outbreak of Covid-19. This column provides new evidence from Italy on the degree of workplace risk of exposure to the virus. Unsurprisingly, the health sector is the most exposed to diseases and infections, while the services sector is the most risky in terms of physical proximity. These and other findings can help in deciding which activities to reopen first and where to reinforce security measures.

Graziella Bertocchi, 23 April 2020

As countries gradually loosen lockdown restrictions, there will be increased urgency to determine which segments of the population are least susceptible to COVID-19 and should return to work first. This column re-examines the data on women in Italy and finds that working-age women are more susceptible to the disease than working-age men, likely due to women’s over-representation in jobs – namely, health and education – that expose them to a higher risk of contagion. Policies that count on women replacing men as lockdowns lift could aggravate the problem rather than solve it.

Çağatay Bircan, Zsoka Koczan, Alexander Plekhanov, 21 April 2020

Small businesses, especially in retail and services sectors, which account for the vast majority of employment in the European region, have borne the brunt of the COVID-19 crisis. This column provides estimates of job displacement and surveys the policy measures taken by 38 emerging economies in Europe, Central Asia, and the Southern and Eastern Mediterranean in response to the economic disruptions. Given the predominance of small businesses in employment, job displacement rate in many of these economies is expected to reach 30%.  In the presence of constraints on fiscal measures and limited administrative capacity to disburse funding, second-best measures such as price control have been implemented widely.

Simona Bignami-Van Assche, Daniela Ghio, Ari Van Assche, 17 April 2020

It is well understood that COVID-19 severity varies with age. However, little consideration has been given to the differential trend of infections across age groups. By drawing from the Italian experience, this column shows how the effectiveness of strategies to ‘flatten the curve’ of COVID-19 infections crucially depends on workforce demographics. It suggests that restricting the age of essential workers may be useful to mitigate the work–security trade-off while keeping the economy going.

Eduardo Levy Yeyati, Luca Sartorio, 16 April 2020

The policy tools being used to stabilise incomes during the COVID-19 lockdowns will provide job and payment protection for formal, salaried workers. But in the developing world, these workers account for only half of the labour force. This column looks at the other half: the ‘independent’ workers who have not only seen their incomes reduced, but who possess few of the benefits tied to jobs – from reliable hours to severance pay and social security. If disparities in labour markets go unaddressed, the pandemic will deepen the toll on poverty and inequality.

Abigail Adams-Prassl, Teodora Boneva, Marta Golin, Christopher Rauh, 08 April 2020

The spread of COVID-19 has already had a large negative impact on labour supply and earnings of workers in many countries. In this column, the authors leverage newly collected data from the US and the UK to show that these negative consequences are particularly harsh for younger workers, those with unstable employment relationships and lower labour income. The evidence calls for a quick response from governments in the form of stimulus and labour income replacement packages, and a robust plan to ensure that the younger generation are not permanently disadvantaged.

Brian Bell, Nicholas Bloom, Jack Blundell, Luigi Pistaferri, 06 April 2020

The COVID-19 pandemic is turning into a global recession – probably the biggest drop in economic activity since the Great Depression of the 1930s. This column uses over 3 million earnings observations drawn from more than 400,000 UK workers between 1975 and 2016 to identify groups of workers who are most exposed to aggregate risk. This findings suggest that young male workers at small firms could see earnings losses of 8% to 9%, with older women at large firms seeing little or no change in their earnings.

Christian Dippel, Daniel Trefler, 05 November 2017

One way employers can compel workers to accept contracts they otherwise would not accept is by limiting the outside options for those workers. This column explores this facet of labour coercion in the context of post-Emancipation Caribbean islands prior to WWI. On islands where freed slaves had options other than plantation work, sugar exports fell dramatically. Where geographic factors limited these outside options, such as Antigua and Barbados, the plantation system continued to prosper.

Julián Messina, Oskar Nordström Skans, Mikael Carlsson, 23 October 2016

While standard microeconomic theory suggests that firms have no power over setting wages when markets are perfectly competitive, this view obviously clashes with the perceptions of the casual observer. This column uses data from Sweden to investigate the extent to which differences in firms’ pay are related to differences in physical productivity. It finds that firms that benefit from positive productivity shocks increase the wages of incumbent workers, and in particular firms among which there is substantial labour mobility. The evolution of productivity among such firms appears to be a crucial determinant of workers’ wages.

Enrique Fernández-Macías, Martina Bisello, 25 September 2016

A tasks approach to labour market analysis can contribute to a better understanding of structural change and employment trends. However, its narrow focus on a few specific types of task content and its neglect of the social aspects of production can limit the usefulness of this approach. This column presents a new framework for conceptualising and measuring tasks, and discusses an application to Europe.


CEPR Policy Research