The effects of Job Retention Schemes on Employment Preservation during the COVID-19 Epidemic in Euro Area Countries
In this paper, we analyse the effects different job retention (JR) schemes take-ups on the preservation of employment during the COVID-19 pandemic in euro area countries. We find that JR schemes in euro area countries helped reduce job losses during the pandemic. The most effective at preserving employment were take-ups of the most extensively updated pre-existing short-time work (STW) schemes that were more generous and included nonstandard workers. However, the impact of JR schemes was less than the overall employment preservation achieved. In contrast to the Great Recession, macroeconomic measures of economic support have helped preserve jobs during the pandemic as well. Corresponding differences in sectoral employment preservation effects show that such macroeconomic support led to more jobs being kept, by far the most in the group of vulnerable service sectors.