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Worker adjustment to unexpected occupational risk: Evidence from COVID-19
Nils Braakmann1, Barbara Eberth1, John Wildman2
1Business School - Economics, Newcastle University, Newcastle upon Tyne NE1 7RU, United Kingdom.
European Economic Review
|October 31, 2022
Summary
Workers left high-risk COVID-19 occupations in 2020, but wages remained stable. This occupational shift was more pronounced for those not under lockdown orders and clinically vulnerable individuals, indicating a response to pandemic mortality risk.
Area of Science:
- Labor Economics
- Epidemiology
- Occupational Health
Background:
- The COVID-19 pandemic introduced a novel occupational risk: mortality.
- Understanding how workers respond to newly revealed occupational hazards is crucial for labor market dynamics.
Purpose of the Study:
- To examine the relationship between COVID-19 mortality risk and worker behavior, specifically wage adjustments and occupational mobility.
- To identify factors influencing these behavioral changes.
Main Methods:
- Linking occupation-specific COVID-19 mortality data with individual-level datasets.
- Analyzing wage and employment changes in relation to pandemic risk exposure.
Main Results:
- Wages did not significantly adjust in response to COVID-19 mortality risk.
- Workers began exiting high-risk occupations during 2020.
- These effects were amplified for workers less impacted by lockdowns/remote work and for clinically vulnerable individuals.
- Behavioral changes were not driven by negative health shocks or employer-initiated separations.
Conclusions:
- Workers demonstrated responsiveness to occupational mortality risks by changing jobs, not by demanding higher wages.
- The findings highlight the importance of individual vulnerability and work environment in shaping labor market responses to health crises.
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