The Effect of COVID-19 on the Quality of Employment in Colombia

The Indian Journal of Labour Economics https://doi.org/10.1007/s41027-024-00530-4 ARTICLE The Effect of COVID‑19 on the Quality of Employment in Colombia Jhon James Mora1 · José María Arranz2 Accepted: 11 October 2024 © The Author(s) 2024 Abstract This article analyses the effect of COVID-19 on the quality of employment in Colombia. Based on the construction of two job quality indexes, we estimate a pseudo-panel-ordered probit model correcting for measurement errors and the endogeneity of education. Depending on the job quality index, our results show that the probability of having a low-quality job increases between 1.6 and 27.8 percent points (p.p). In contrast, the probability of having a high-quality job decreases by 8.3 and 21.4 p.p. due to COVID-19. Also, people with higher levels of education are more likely to have high-quality jobs in Colombia; being a Venezuelan immigrant reduces the probability of having quality jobs, and being a woman has different effects depending on the index. Keywords Job quality · COVID-19 · Venezuelan immigrants · Education · Pseudopanel-ordered probit · Instrumental variables JEL Classification J08 · J28 · C23 · C26 1 Introduction The effects of COVID-19 on employment have been disastrous. Actions to slow the spread of the pandemic, such as containment and quarantines, have led to a drop in jobs worldwide. Companies in service-related sectors that could use technological tools resorted to strategies such as teleworking or working from home. These measures have impacted quality of life and employment, among other variables. * Jhon James Mora 1 Departamento de Economía, Profesor Titular, Universidad Icesi, Calle 12 # 18‑122. (Cali‑Colombia), Cali, Colombia 2 Departamento de Economía, Catedratico de Universidad, Universidad de Alcalá, Plaza de La Victoria 2. Alcalá de Henares, 28802 Madrid, Spain Vol.:(0123456789) ISLE The Indian Journal of Labour Economics In Colombia, as in other countries, employment has been reduced, and unemployment has increased due to the effects of COVID-19. According to the National Administrative Department of Statistics (DANE in Spanish), the employment rate fell to 49.8% in 2020 compared to 56.6% in 2019. Results imply that, in total, 2.4 million Colombians lost their jobs during 2020. Conversely, the unemployment rate increased by 5.6 p.p. in 2020 compared to 2019 (16.1% vs. 10.5%), which increased to 1.4 million unemployed. However, the adverse effects observed in the labour market were not equal for all Colombians, widening the gap mainly among young people (Mora et al. 2021; Farné & Sanín 2021) between rural and urban areas (Becerra et al. 2021) and between sectors (Farné & Sanín 2021) and in turn there was a drop of slightly more than 10% in the number of hours worked, so that on average Colombian workers spent in their jobs 4.4 h less per week than they did before the pandemic (Alfaro et al. 2022). Isaza-Castro (2021) shows that the pandemic disproportionately affected occupations performed by women, such as those involving proximity and social interaction with other people. As women in Colombia are traditionally taking most of the households’ reproductive work burden, including the care of children and older people, the pandemic had a disproportionate effect on female labour force participation, which recorded the lowest levels in more than two decades. Finally, Isaza-Castro concludes, "The crisis in Colombia has a face of young women" (p. 13). No studies have analysed the effect of COVID-19 on the quality of employment in Colombia. Some analyses have shown that informal workers had less earnings (Becerra et al. 2021; Farné & Sanin 2021), and from this information, it is inferred that the quality of employment has been reduced. At the Latin American level, Sehnbruch et al. (2020), using the Alkire and Foster method, analyse the quality of employment in Colombia, Brazil, Bolivia, Chile, Ecuador, Mexico, Paraguay, Peru, and Uruguay for 2015. The results show that 68.6% of Colombian workers suffer some deprivation of conditions that increase job quality. The synthetic index developed by Sehnbruch et al. (2020) also indicates that Chile, Uruguay, and Brazil have the best job quality indicators for this group of countries; Chile exhibits the best results, while Paraguay presents the worst consequences. The main contribution of this paper is to analyse the effect of COVID-19 on the quality of employment in Colombia. Two indexes are used for this purpose. The first is an adaptation of the job quality index of Mora and Ulloa (2011), which includes wages, and the second is an adaptation of the index proposed by Arranz et al. (2018), which excludes wages. Although both indexes coincide in the use of hours worked, there are substantial differences, such as income (wages) information or the level of overeducation. Our results show that COVID-19 hurt job quality and that workers with fewer years of education are less likely to have a high-quality job than those with more years of schooling. However, the results for women are inconclusive as different signs are obtained depending on the type of index used. Finally, Venezuelan immigrants are more likely to have lower job quality. ISLE The Indian Journal of Labour Economics 2 The Quality of Employment In 2007, during the fourth seminar on quality of work measures, the International Labour Organization (ILO), the European Union (EU), and the European Foundation for the Improvement of Living and Working Conditions compared the dimensions of their conceptual frameworks. As a result, they developed a new framework with an international approach to measuring job quality. It should be noted that the ILO’s primary focus has been on the concept of “decent work.” In this sense, Arranz et al. (2016) argue that this concept represents more an expression of a political objective than something operational. Several years of discussion culminated in the publication of a handbook on concepts and definitions for more than 50 “decent work indicators” that could be used to monitor progress in implementing the "Decent Work Agenda" (ILO 2012). The quality of employment must be based on objective factors, as pointed out by Slaughter (1993), Van Bastelaer and Hussman (2000), and Reinecke and Valenzuela (2000), since these are unalterable and do not depend on the individual’s preferences or expectations (Bustamante & Arroyo 2008, p. 145). Decent work is characterised as quality work, an attribute that replaces its productive and well-paid nature (Ermida-Uriarte 2001). The concept of decent work and job quality is highly interrelated. Job quality is defined as the set of factors linked to work that influence the economic, social, psychological, and health well-being of workers (Reinecke & Valenzuela 2000), these factors being the expression of objective characteristics dictated by labour institutions and by norms of economic, social, and political acceptance (Farné 2003). (...truncated)