The COVID-19 pandemic not only led to lasting structural changes to work environments across the workforce, but it also greatly influenced the high disparity between job availability and jobseeker interest.
A research paper published by Indeed, George Washington University, and the Organisation for Economic Cooperation and Development (OECD) shows how different workplace retention policies influenced the labor market’s recovery and occupational mismatch across different countries.
Indeed’s Hiring Lab reports that this mismatch eventually returned to pre-pandemic levels, but the speed of this adjustment varied significantly depending on the job retention policies implemented by different countries. This, in turn, influenced job seekers’ interest in different fields.
The researchers found manufacturing job postings, which were significantly affected early in the pandemic, ended 2022 with a higher share of total job postings than in 2019. Meanwhile, sales and customer service jobs, which had a larger share in 2019, saw a reduced share by the end of 2022.
Countries that used what is referred to as “short-time work schemes” were notably slower in reducing the occupational mismatch compared to those that did not.
It’s reported that these strategies incentivized employers to retain workers by putting them on reduced work schedules with partial compensation from the government. While this approach was found to be effective in softening unemployment rates during the temporary downturns, it proved less suitable for adjusting to the prolonged economic shifts caused by the COVID-19 pandemic.
The research, which compared sector-specific job postings against jobseeker interest from January 2019 to January 2023, reveals that businesses in expanding sectors had a particularly hard time finding workers as businesses in contracting sectors held onto them.
For comparison, wage subsidies — cited as another form of job retention scheme utilized during the pandemic — did not have a noticeable impact on occupational mismatch.
