What shifts did covid-19 year 2020 bring to the labour market in Europe?

ABSTRACT

This article discusses the evolution of key labour market indicators in the EU-27 countries between 2019 and 2020, i.e. between the year before the covid-19 crisis broke out and the year in which it impacted the economy heavily. Whereas earlier studies have dealt with the evolution of unemployment in 2020, often country by country, this article focuses on describing the evolution of unemployment as well as inactivity across European countries. It appears that the Southern European countries, in particular, recorded increases in inactivity, while the Baltic States experienced higher growth in unemployment. In many other countries, unemployment and inactivity remained remarkably stable despite covid-19. The country comparison bears many similarities to that in 2009, when the Great Recession knocked back the European economy.

KEYWORDS:

• Unemployment
• inactivity
• covid-19
• iceberg
• discouragement

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 We also explain this logic and the various indicators for measuring the health of a labour in an animated video that can be viewed at www.stijnbaert.eu or directly via this YouTube-link https://youtu.be/DDICIu5ykrc

2 During the last decades, the employment rate has become more prominent as a crucial indicator of labour market performance – as indicated by an anonymous reviewer of a former version of this article, it has been the main indicator suggested by the European Employment Strategy launched in 1997 (Council of the European Union 1997). However, this indicator is still somewhat less prominent in debates during a crisis period given that dismissals obviously translate into unemployment – as an illustration, ‘employment rate’ in combination with ‘covid-19’ yields 16.5 million Google hits on 14 July 2021, while for a combination with ‘unemployment rate’ this is more than 20.3 million. Moreover, Baert (2021) argues that also the employment rate is not an indicator that adequately captures the health of a labour market since job seekers and inactives are lumped together. For an overview of other relevant indicators, we refer to Brandolini and Viviano (2018) and ILO (2016).