Report

COVID and the Labour Market in Europe – Temporary workers were disproportionately affected

The COVID-19 pandemic closed or limited many economic activities in 2020, with far-reaching impacts on the labour market. Employment losses at the outset of the pandemic were sharper than those experienced during the global financial crisis. Even greater declines in hours worked arose as a result of the widespread state-supported furloughing of workers. The physical distancing policies of governments led to another significant and largely ad hoc adjustment – the shift to mass remote working for those workers whose jobs allowed it.

This report describes the employment and working time developments by sector and occupation through the first year of the crisis. It explores which categories of workers were most affected – primarily temporary workers, the young and low-paid women. It also assesses the extent to which remote working served as a buffer during the crisis, preserving jobs that might otherwise have been lost.

Key findings

  • Employment fell most sharply early in the pandemic in the EU, with over five million fewer jobs than a year earlier. Temporary workers were disproportionately affected by the crisis, accounting for over three-quarters of net job losses in the EU27 during 2020. In terms of demographic group, low-paid women and younger workers were the biggest losers, suffering the sharpest employment declines during the early, most severe period of the pandemic.
  • Rather than a fall in the EU’s employment headcount, the peak of the pandemic saw an increase in the share of employed workers not working. These ‘furloughed’ workers accounted for around two-thirds of the decline in hours worked at the height of the crisis. State intervention and fiscal support proved crucial to protecting economies and labour markets in the face of this large, unanticipated shock.
  • The sectoral impact of the crisis was uneven and shaped largely by government lockdowns and social distancing measures. High social interaction, non-teleworkable jobs in sectors such as hotels, sales, restaurants and accommodation experienced the biggest declines in hours worked. Even sectors identified as essential across the Member States saw working hours drop. Conversely, jobs in knowledge-intensive services grew during the crisis as these sectors rushed to transform or digitalise work processes in response to social distancing measures and higher levels of remote work.
  • The most vulnerable workers in the pre-pandemic labour market experienced worsening socioeconomic conditions during the crisis. It will be critical in the recovery phase for policy makers to reflect on how more inclusive social protection schemes can serve as a buffer against an intermittent job recovery. Robust public and social partner support will also be required as more vulnerable workers face greater challenges in adjusting to the digital and green transition.
  • The share of workers working from home during the pandemic was many times higher than those who did so regularly before the COVID-19 crisis. Live survey sources estimate 20–60%, and official European Union Labour Force Survey (EU-LFS) data point to more modest increases, with 21% of workers working from home at least some of the time in 2020. These figures are still lower than the overall teleworkable share of employment in the EU27, which is estimated at 37%.

Chosen excerpts by Job Market Monitor. Read the whole story @  What just happened? COVID-19 lockdowns and change in the labour

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