Bringing Back the Jobs Lost to Covid‐19: The Role of Fiscal Policy

2022/12/29 by CHRISTIAN BREDEMEIER, Christian Bredemeier, FALKO JUESSEN +3
Economics, Econometrics and Finance · Health Professions · Psychology · #COVID-19 Pandemic Impacts #Employment and Welfare Studies #Psychological Well-being and Life Satisfaction

paper · pdf · doi:10.1111/jmcb.13005

Abstract

Abstract Covid‐19 induced job losses occurred predominantly in industries with intensive worker–client interaction as well as in pink‐collar and blue‐collar occupations. We study the ability of fiscal policy to stabilize employment by occupation and industry during the Covid‐19 crisis. We use a multisector, multioccupation macro‐economic model and investigate different fiscal‐policy instruments that help the economy recover faster. We show that fiscal stimuli foster job growth for hard‐hit pink‐collar workers, whereas stimulating blue‐collar job creation is more challenging. Only a cut in labor income taxes generates a substantial number of blue‐collar jobs.

Citations

• OCCUPATIONAL SPECIFICITY OF HUMAN CAPITAL*
• Shocks and Frictions in US Business Cycles: A Bayesian DSGE Approach

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