This non-technical summary is not part of the discussion paper mentioned above, but has been prepared with the aim of providing an ambitious review of the document, based on the research effects of the document and focusing primarily on its policy implications. Main points of the research, read the discussion paper subtitled. The perspectives expressed in this non-technical summary are only those of the individual authors and do not necessarily constitute the perspectives of the Research Institute for Economics, Trade and Industry (RIETI).
What effect has the dramatic decline in mobility due to the COVID-19 pandemic had on performance-consistent business performance?In our research, we relied on a survey of Japanese corporations during the COVID-19 pandemic to read about how crisis-driven mobility adjustments have affected businesses. sales, employment and hours worked according to the employee, and how the implementation of work from home (WfH) helped corporations mitigate negative effects.
Reduced mobility resulting from the Japanese government’s declaration of a state of emergency and concerns about infection have led to a significant decline in corporate business activities. As Figure 1 shows, the effect of functionality was greater among companies facing greater mobility adjustments. We analyze this effect in the use of mobility adjustments practiced in the Google Community Mobility Report and a survey of Japanese corporations conducted through the Center for Research and Education in Program Evaluation (CREPE) of the University of Tokyo and Tokyo Shoko Research , Ltd. (TSR). ). We found that sales fell on average by 2. 8% and hours of operation by 2. 1% on average in reaction to a 10% drop in people’s mobility, but we saw no effect on employment. This muted employment reaction is consistent with limited adjustments in overall employment by a wide margin during the COVID-19 pandemic in Japan. When analyzing this effect in other business sizes and in other industries, we found that the effect on sales and hours of operation was greater in smaller companies and in those in higher-contact industries, such as retail. retail and accommodation.
Have WfH schemes helped mitigate the effect of this decline in mobility on companies’ activities?We found that the effect on operations has been greatly reduced among companies that had followed the provisions of the WfH before December 2019, before the arrival of COVID. -19. This result is presented in Table 1. Al as with the effect due to adjustments in mobility, we found no effect on employment. However, we found that the adoption of WfH prior to COVID-19 has mitigated the negative effect. effect of decreased mobility by about 55% in terms of sales and about 35% in terms of painted hours. In addition, we show that adapting to the crisis environment by expanding the number of painters running away from home has also helped mitigate the negative effect. However, we also find that the attenuation effect of WfH agreements differs significantly from firm to firm and is limited to those in low-contact sectors, with no effect observed in high-contact sectors.
The COVID-19 pandemic has caused a sudden and significant disruption in sales and business schedules due to a really significant drop in mobility. In the context of economic crises resulting from outbreaks such as COVID-19, we see that greater diversification of the workforce through the WfH However, at the same time, the evolution of mobility does not affect the functionality of all corporations in the same way, indicating a heterogeneity of the mitigating effect due to WfH devices.