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Did COVID-19 change task requirements on the job? Evidence from online job vacancies

This paper uses job vacancy data to provide causal analysis on the labor market effects of COVID-19. Using online job postings from January 2017 until December 2021 for the near-universe of German firms, we explore whether COVID-19 has changed task demand across firms and local labor markets. To permit causal interpretation, we exploit the sudden economic shock in March 2020 as a quasi-experiment and implement an event-study design coupled with Difference-in-Difference estimation. We find a short-term decrease in demand for interactive tasks by up to 12% and simultaneous increase in demand for manual tasks by up to 20% across local labor markets, with pronounced effects in agglomeration and rural regions. Our firm-level analysis adds important heterogeneities, suggesting these COVID-induced task shifts are primarily driven by (i) large firms, (ii) business related services, and (iii) firms with less technological adaptability to WFH.