Labor markets in crisis: The double liability of low-wage work during COVID-19

Forthcoming.

Working Paper (latest)  ·  CLEF Working Paper (old)  

We adopt a novel identification strategy to examine the heterogeneous effects of Canada’s COVID-19 economic shutdown on hours worked across the earnings distribution. Early labor market analyses found that workers in the bottom of the earnings distribution experienced a much larger reduction in hours worked than workers in the top of the earnings distribution. Our analysis reveals a double-liability of low-wage work during Canada’s COVID-19 economic shutdown: while workers in every quintile experienced a large reduction in hours on average, significant increases in hours were only present among workers in the bottom quintile. Implications for crisis income supports are discussed.