Understanding the Impact of COVID-19 Intervention Policies on the Labor Market of the Hospitality and Retail Industries

Posted: 29 Jun 2020

See all articles by Arthur Huang

Arthur Huang

University of Central Florida

Christos Makridis

Stanford University; Arizona State University (ASU); Massachusetts Institute of Technology (MIT) - Sloan School of Management; Department of Veterans Affairs (VA)

Mark Baker

University of Central Florida - Rosen College of Hospitality Management

Marcos Medeiros

University of Central Florida - Rosen College of Hospitality Management

Zhishan Guo

University of Central Florida

Date Written: June 29, 2020

Abstract

Using new high-frequency data that covers a representative sample of small business owners, we investigate the effects of the COVID-19 pandemic and the resulting state policies on the retail, hospitality, food, and accommodation sectors. First, we find that business closure policies are associated with a 20-30% reduction of non-salaried workers in the hospitality industry and a 10-20% decline for the retail sector from March-April of 2020. Second, business reopening policies play a statistically significant role in reviving the labor market, though at a slower pace. Third, considerable differences exist in the impact of policies on the labor market by state. Fourth, the rise of new cases on a daily basis is associated with the continued deterioration of the labor market. We use these results to provide policy and managerial recommendations for restoring the labor market and curbing the transmission of COVID-19.

Keywords: COVID-19, labor market, employment, coronavirus intervention policy, retail and hospitality sectors

JEL Classification: H75, J21, J23

Suggested Citation

Huang, Arthur and Makridis, Christos and Baker, Mark and Medeiros, Marcos and Guo, Zhishan, Understanding the Impact of COVID-19 Intervention Policies on the Labor Market of the Hospitality and Retail Industries (June 29, 2020). Available at SSRN: https://ssrn.com/abstract=3637766 or http://dx.doi.org/10.2139/ssrn.3637766

Arthur Huang

University of Central Florida ( email )

9907 Universal Blvd
Orlando, FL 32819-8701
United States

Christos Makridis (Contact Author)

Stanford University ( email )

Stanford, CA 94305
United States

Arizona State University (ASU) ( email )

Farmer Building 440G PO Box 872011
Tempe, AZ 85287
United States

Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )

100 Main Street
E62-416
Cambridge, MA 02142
United States

Department of Veterans Affairs (VA) ( email )

810 Vermont Avenue NW
Washington, DC 20420
United States

Mark Baker

University of Central Florida - Rosen College of Hospitality Management ( email )

9907 Universal Blvd
Orlando, FL 32819-8701
United States

Marcos Medeiros

University of Central Florida - Rosen College of Hospitality Management ( email )

9907 Universal Blvd
Orlando, FL 32819-8701
United States

Zhishan Guo

University of Central Florida ( email )

4000 Central Florida Blvd
Orlando, FL 32816-1400
United States

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