Work and wellbeing during Covid-19: how were European countries affected?

Comparing data from France, Germany, Italy and the UK shows that social inequalities typically increased during the pandemic. Young people and those with less education were most affected by job losses: policy intervention could get more of them back into work.

Covid-19 resulted in a sharp economic downturn. In the UK, there were layoffs, with 1.3 million people losing their jobs between March 2020 and January 2021. Similarly, millions of people were furloughed – over 11.7 million jobs were on the Coronavirus Job Retention Scheme over the 18 months that it was in place. Remote working also increased dramatically.

Were these effects similar across major European economies? And did the pandemic exacerbate existing inequalities across age, education and gender?

What does research show?

People on a low income and with lower levels of education were more affected by job loss and furlough, and less likely to work remotely, according to research mostly carried out while the pandemic was at its height in 2020 (and into 2021). This work also highlighted that younger workers were more likely to be employed in ‘non-essential’ sectors.

Women were particularly affected. Across many countries, the Covid-19 recession had an unusually large impact on working women – especially those with children. Women’s childcare responsibilities increased, which made them more likely to make the transition to remote work and reduced working hours, and to be at greater risk of losing their jobs.

Looking specifically at stress and mental health, those who lost a loved one suffered post-traumatic stress. There were wider effects too: for example, lockdowns restricted social contact, potentially triggering depression and loneliness.

Mental health inequalities widened as the severity of the pandemic increased. Here too, there were different effects for different groups: the unemployed and people with lower incomes experienced lower levels of subjective wellbeing, and negative effects appear to have been greater for women and younger people.

What changed during the pandemic?

New research from the European Commission’s Social Situation Monitor uses data from France (the ‘COCO’ dataset), Germany (the German Internet Panel and the Mannheim Corona Study), Italy (ResPOnsE Covid-19 study) and the UK (Understanding Society) to get a deeper understanding of the social effects of the pandemic.

Each study used a series of questions to ask about employment and to capture feelings of depression and loneliness. The Commission research took account of factors that might shape how each country was affected, such as:

Employment protection: this was weakest in the UK before the pandemic, so the expectation was that there would be higher levels of unemployment there.
The share of jobs that could be done remotely: this was highest in the UK, so the biggest increase in working from home was likely be there.
The extent of school closures: this was highest in Italy and the UK, which could have implications for parents’ wellbeing, especially if they had younger children.

The new data show that the sharpest falls in the numbers of people in paid work were seen in France and the UK, but the numbers recovered as the pandemic progressed. In France, the drop in employment was similar for men and women, but men’s employment recovered sooner. In Italy, women were more likely to be unemployed than men throughout. In Germany and the UK, the gender differences were less pronounced.

Looking at differences by age and education, in France, Italy and the UK, younger people and people with lower levels of education saw greater rises in unemployment. These associations were not seen in Germany. France, Italy and the UK also saw similar levels of people working at home – at or near 50% – but this was lower in Germany (34%). People with degrees were more likely to work remotely in all four countries.

What does the new research tell us?

The new research provides insights into whether subjective wellbeing and mental health changed during the first lockdown, whether there was any recovery between lockdowns, whether particular social groups were more affected and whether changes to wellbeing and mental health could be explained by changes in people’s work and economic situations.

In line with earlier research, the study finds that subjective wellbeing fell in the first lockdown and recovered by the spring of 2021, but not fully. Unsurprisingly, depression and loneliness tended to be lowest among those who were working and highest among the unemployed.

In France, Germany and the UK, people working from home reported slightly higher levels of wellbeing on average. As might be expected, furlough buffered the negative effects of unemployment. But the longer the pandemic went on, the more wellbeing and mental health levels of those who were working fell towards those of the unemployed.

One surprising result was that average levels of depressive feelings and loneliness remained stable overall. But younger people seemed to be at greater risk of depressive symptoms and loneliness. Women were more likely than men to report feeling very or frequently depressed or lonely – and in Italy and the UK, women were more likely than men to report loneliness.

What are the lessons – and what do they suggest for government policy?

It is widely understood that employment fell during the pandemic, but also that furlough helped to prevent mass unemployment. At the same time, some existing social inequalities increased. Specifically, younger people and workers with lower levels of education were more likely to lose their jobs or to go on furlough, while people with degrees were more likely to have the opportunity to work from home.

The study also suggests that the longer people were on furlough, the more negative the consequences were for their mental health and subjective wellbeing. The findings call for policies that help to reintegrate these workers into the job market – particularly targeting younger workers and less educated members of society. Incentives such as tax breaks for companies hiring these groups of people as employees could be effective here.

Remote working increased in all four of the countries studied. The biggest rise was seen in the UK, as expected. This was likely to have been because of the greater share of jobs that can be done from home in the UK economy. In France and Italy, many workers have gone back to the workplace, but this move has been smaller and slower in Germany and the UK.

Remote workers reported slightly higher levels of wellbeing, especially in the UK. These differences have remained over time, so it seems (at least in the current time frame) that continued remote work does not pose any mental health risk.

One question that may arise from this is why there are differences between individual countries. The study does not identify a good explanation in the data – and from a global (and indeed, European) perspective, the four countries are similar in terms of their institutions, economic development and the extent to which they were affected by Covid-19.

It may still be too early to assess fully the ramifications of the pandemic for wellbeing and mental health. Governments should continue to monitor the social and mental health conditions of young people, women and people with lower levels of education, who all seemed to be at the greatest risk of disadvantage during the pandemic. It would be worth encouraging information campaigns and other policies to support mental health, especially for these disadvantaged groups.