Covid-19 wage subsidy support and effects

Covid subsidies

were selectively drawn down

and worker flows changed.

CWS payments were more likely received by small firms and firms in the Construction and Accommodation and Food Services industries, as well as those in Manufacturing, Wholesale Trade, Transport, Post and Warehousing, Administration and Support Services, and Arts and Recreation Services industries.

Male and younger workers were also more likely to receive CWS payments than females and older workers respectively.

During the CWS payment period, job turnover rates dropped more in firms that received CWS payments than in other firms.  However, turnover in subsidised firms has returned to about pre-lockdown levels, while turnover in non-subsidised firms has remained lower than before.

The analysis provides a foundation for further analysis of the impact of CWS or the pandemic and related policies on labour market adjustment and dynamics.

DOI: doi.org/10.29310/WP.2021.02

Citation

D R Hyslop, D C Maré. 2021. “Covid-19 wage subsidy support and effects.” Motu Working Paper 21-02. Motu Economic and Public Policy Research. Wellington, New Zealand.