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What is the impact of the COVID-19 crisis depending on the age of workers?

What is the impact of the COVID-19 crisis depending on the age of workers?

The measures to contain the expansion of Covid-19 have had numerous economic repercussions, although their effects have been heterogeneous at the level of region, sector and group of workers. According to data obtained by Asempleo in the March Bulletin “ASEMPLEO-Afi Labor Market Advancement”, although from a health point of view, Covid-19 has more seriously affected people over 50, in the workplace , this collective is the one that suffered the least in 2020.

In the opposite situation is the under-25 group, which, although having better resisted the impact of the virus in the health field, has been the group most affected from a work perspective. In the past year, almost one in four young people under 25 have lost their job or been affected by ERTE in our country. In turn, around 40% of young people are currently unemployed, compared to 12.7% of those over 50.

The greater volatility of youth employment in the face of changing economic conditions is not specific to this crisis, but in turn recurred during the previous shock. Indeed, between 2007 and 2013, nearly two out of three children under 25 (62.1%) lost their jobs due to the crisis. On the contrary, the employment of those over 50 increased by 8% during this same period. In short, these data show that, during the last two crises, which were also of unprecedented magnitude in the second half of the twentieth century, the employment of the over-50s was hardly affected, at the same time. time that crushed the employment opportunities of young people in Spain. This asymmetry is mainly due to two factors, which are also interconnected: the differences in the type of contract and sector of activity between young and old.

Temporary employment is an external labor flexibility tool for companies, while the ERTE figure allows internal flexibility to be increased. These two elements have been of great relevance during the current crisis, allowing companies to adapt their workforce to changes in demand, the evolution of the pandemic and the various measures to restrict activity. In this sense, it is not surprising that temporary workers have been the most affected by the crisis. More specifically, 47% of jobs destroyed in 2020 (addition of layoffs and ERTE) were temporary, while they represented only 26% of employment in 2019.

At the same time, the incidence of temporary employment among young people is very high, affecting two in three (67.4%) under 25 in 2020, which helps explain that one in four temporary young people lost his job in 2020. In contrast, only 14.3% of workers over 50 have a temporary contract, and only 4.7% of them lost their jobs last year. In other words, the negative impact of economic shocks on employment is mitigated by permanent job security, which is more common among older workers to the detriment of young people.

Part-time jobs tend to be less protected (there is a positive correlation between temporary and part-time employment), being in turn the most likely to be affected by changes in the workforce. ‘business. Thus, 27.5% of the jobs destroyed throughout 2020 were part-time jobs, while the part-time rate in 2019 barely reached 14.5%. Among young people, the incidence of bias exceeds 36%, and 22.7% of them lost their jobs in 2020. On the contrary, only 11.6% of workers over 50 are employed part-time. , and only 5.2% of them lost their jobs. jobs this year.

Differences in sectoral specialization according to age also help to explain the uneven impact of this crisis on employment. Thus, it is observed that employment in the hotel industry, commerce and other leisure activities has been most affected by restrictive measures aimed at curbing the spread of the virus. In 2020, employment in these sectors contracted by 16.2% (layoffs and ERTE), compared to an average of 7.7% in the economy as a whole. Data shows that more than half (51.3%) of young people under 25 were employed in these sectors in 2019 and that the pandemic lost their jobs to 15.9% of them in 2020.

On the contrary, only 27.9% of workers over the age of 50 work in the hospitality and commerce sector, and only 2.3% of them lost their jobs in 2020. And it is than this group of workers The majority of over 50 are employed (48%) in other activities of the service sector, less affected by the pandemic (-2.4% variation from one year to another). In addition, workers over 50 in these activities have not only decreased due to the crisis, but increased by 1.4% in 2020 compared to 2019, proof of the strength of employment for this. group.

The degree of aging of the working population would also help to explain the asymmetric effect of the crisis at the regional level. Thus, we observe that the regions of the north of the peninsula are those which have lost the least jobs during the year 2020, while it is in these territories where employed people over 50 years of age represent a large part of the total workforce. . Thus, Galicia, Asturias, Cantabria, the Basque Country, Navarre, Aragon, La Rioja and Castilla y León have values ​​lower than the Spanish average in terms of job losses, but higher than the national average. in terms of the weight of people aged 50 in the overall workforce. On the contrary, the three regions which destroyed the most jobs in 2020 (Catalonia, Canary Islands and Balearic Islands), have a relatively young labor market compared to the average for Spain as a whole. On this last point, the sector of activity plays a fundamental role, since the destruction of jobs in these three regions is largely due to a production structure linked to tourism, which mainly employs young workers on temporary contracts.

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