Job Boom or Job Bust? The Effect of the Pandemic on Actual and Measured Job and Employment Growth

Pub. Date
07 February, 2024
walking over rickety brige with covid-19 written on it

Normal life was put on hold for many during the lockdowns in 2020 and 2021 as society
focused on addressing the health crisis. In the labour market, many fewer people started a
new job (‘hires’) and, partly due to the use of the Coronavirus Job Retention Scheme, some
people stayed longer in work than they would in ‘normal’ times. Their job ‘separation’ was
delayed. Other parts of society saw a similar stalling in ‘normal’ turnover. Fewer people
moved into new homes and/or households either in the United Kingdom or abroad with
consequent disruption to trends in housing and internal and international migration.

So, as the health crisis subsided, this stalling of ‘normal’ turnover left behind a major
imbalance of resources. All sorts of people and things were in the wrong place. In many cases
this misallocation of resources was wrongly considered to be a ‘shortage’ – an absolute lack
of people to do a job – as in the case of lorry drivers as the economy re-opened. But in a
relatively short period this disequilibrium unwound and there is now little discussion of a
permanent ‘shortage’. Where did all the lorry drivers come from?

Not only that, but the pandemic caused many people to reconsider where the ‘right
place’ was. Their experience during the pandemic and also changes in their household
and community situation caused them to reconsider their priorities. It caused behavoural
changes to their plans, hopes and expectations for the future.