Health Risks and Labour Supply : Evidence from the COVID-19 Pandemic

Richardson, Joseph (2023) Health Risks and Labour Supply : Evidence from the COVID-19 Pandemic. Working Paper. The Department of Economics.

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Abstract

In this paper, we explore the relationship between health risks from COVID-19 and UK labour supply. Using pre-existing conditions as the source of variation in COVID-19 health risks, we show that employment fell by 2 to 3 percentage points with each prior additional condition, after controlling for pre-pandemic labour supply and other relevant factors. These effects begin in April 2020 and persist through to September 2021, long after the pandemic’s peak. Furthermore, these effects were concentrated in jobs difficult to perform remotely, are not driven by labour demand shocks, and similar relationships did not exist prior to the pandemic.