Labor Market Effects of COVID-19 in Sweden and its Neighbors: Evidence from Novel Administrative Data

25 Pages Posted: 28 Jul 2020

See all articles by Steffen Juranek

Steffen Juranek

Norwegian School of Economics (NHH) - Department of Business and Management Science

Jörg Paetzold

University of Salzburg

Hannes Winner

University of Salzburg - Department of Economics and Social Sciences; Austrian Institute of Economic Research (WIFO); University of Oxford - Oxford University Centre for Business Taxation; University of Innsbruck - Department of Economics & Statistics

Floris Zoutman

Norwegian School of Economics (NHH) - Department of Business and Management Science

Multiple version iconThere are 2 versions of this paper

Date Written: July 24, 2020

Abstract

This paper studies the labor market effects of non-pharmaceutical interventions (NPIs) to combat the COVID-19 pandemic. We focus on the Nordic countries which showed one of the highest variations in NPIs despite having similar community spread of COVID-19 at the onset of the pandemic: While Denmark, Finland and Norway imposed strict measures (‘lockdowns’), Sweden decided for much lighter restrictions. Empirically, we use novel administrative data on weekly new unemployment and furlough spells from all 56 regions of the Nordic countries to compare the labor market outcomes of Sweden with the ones of its neighbors. Our evidence suggests that the labor markets of all countries were severely hit by the pandemic, although Sweden performed slightly better than its neighbors. Specifically, we find the worsening of the Swedish labor market to occur around 2 to 3 weeks later than in the other Nordic countries, and that its cumulative sum of new unemployment and furlough spells remained significantly lower during the time period of our study (up to week 21 of 2020).

Keywords: COVID-19 pandemic, lockdown, labor market effects

JEL Classification: I18, J64

Suggested Citation

Juranek, Steffen and Paetzold, Jörg and Winner, Hannes and Zoutman, Floris, Labor Market Effects of COVID-19 in Sweden and its Neighbors: Evidence from Novel Administrative Data (July 24, 2020). NHH Dept. of Business and Management Science Discussion Paper No. 2020/8, Available at SSRN: https://ssrn.com/abstract=3660832 or http://dx.doi.org/10.2139/ssrn.3660832

Steffen Juranek

Norwegian School of Economics (NHH) - Department of Business and Management Science ( email )

Helleveien 30
Bergen, NO-5045
Norway

Jörg Paetzold

University of Salzburg ( email )

Hannes Winner

University of Salzburg - Department of Economics and Social Sciences ( email )

Residenzplatz9
Salzburg, 5010
Austria

Austrian Institute of Economic Research (WIFO) ( email )

P.O. Box 91
Wien, A-1103
Austria

University of Oxford - Oxford University Centre for Business Taxation ( email )

Saïd Business School
Park End Street
Oxford, OX1 1HP
United Kingdom

University of Innsbruck - Department of Economics & Statistics ( email )

Universitatsstrasse 15
Innsbruck, A-6020
Austria

Floris Zoutman (Contact Author)

Norwegian School of Economics (NHH) - Department of Business and Management Science ( email )

Helleveien 30
Bergen, NO-5045
Norway

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