Demography and Labor Economy During COVID-19: How Fluctuations In Workforce Age Distribution Impacted GDP Per Capita
DOI:
https://doi.org/10.58445/rars.2431Keywords:
COVID-19, Heterogeneity, GDP Per CapitaAbstract
In the United States alone, the COVID-19 pandemic was responsible for over 1.2 million deaths and 18 million layoffs, significantly reshaping the demography and productivity of the labor force. These changes triggered a sharp contraction in economic activity, where such effects could be observed in supply chains, consumer demand, and ultimately GDP per capita. In this article, I run two linear regressions to test how 1) the share of individuals employed and 2) the per capita death rate by age bracket impacts GDP per capita. Specifically, I compare the relative coefficients of younger age groups with older age groups, highlighting how people’s income and consumption trends fluctuate as they age. My coefficients reveal that within the employed population, 65-100 year olds generally contribute the most to the GDP measure, while 55-64 year olds contribute the least. However, when accounting for both the employed and unemployed population, I find that 25-34 year olds contribute the most to the economy, while 55-64 year olds again contribute the least. Therefore, these results suggest that the economic impact of COVID-19 was exacerbated because the 25-34 and 65-100 age groups, which had the highest economic productivity, experienced the highest levels of job loss and premature retirements during the pandemic.
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