Worker reallocation in Italy and Spain after the COVID-19 pandemic

Abstract

We provide evidence on the evolution of worker reallocation in Italy and Spain during the pandemic. In both countries, job-to-job transition rates fell in 2020 but improved in 2021 in aggregate. We then focus on cross-sectoral mobility following job separation. In Italy, we find a modest increase in sectoral reallocation in 2020, reaching 4 percentage points at the end of 2021—around 11 percent of the pre-pandemic average reallocation rate. In contrast, there are no statistically significant differences in the reallocation probability with respect to the pre-pandemic average in Spain.