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Modelling the Differing Impacts of Covid‐19 in the UK Labour Market †
Author(s) -
Martin Chris,
Okolo Magdalyn
Publication year - 2022
Publication title -
oxford bulletin of economics and statistics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.131
H-Index - 73
eISSN - 1468-0084
pISSN - 0305-9049
DOI - 10.1111/obes.12497
Subject(s) - pandemic , covid-19 , economics , dynamic stochastic general equilibrium , construct (python library) , labour supply , labour economics , unemployment , demographic economics , macroeconomics , monetary policy , medicine , computer science , virology , outbreak , infectious disease (medical specialty) , disease , pathology , programming language
This article studies the impact of the Covid‐19 pandemic on graduates and non‐graduates in the United Kingdom. We construct a DSGE model with search frictions that is designed around key features of the UK labour market and simulate the model using an array of shocks, designed to mimic the impact of the Covid‐19 pandemic. We show that our relatively simple macroeconomic model can describe the impact of the pandemic on output, employment and wages. Our results show that the impact of the pandemic on employment and wages was more severe for non‐graduates than for graduates, and that up to 5 million jobs would have been lost in the first wave of the pandemic in the absence of the Job Retention Scheme.