University Closures and Local Labor Markets During the COVID-19 Pandemic : The Case of South Korea

Since the outbreak of COVID-19, most universities in South Korea have been closed, and face-to-face classes have been replaced by non-face-to-face online classes. This article estimates the effect of temporary university closures due to COVID-19 on the local labor market using a two-way fixed effects model, which compares the change in the number of unemployment benefits (UB) applicants before-and-after university closures between counties with and those without universities. The estimation result shows that the number of UB applicants increases by 8.3 percentage points more after the closure of universities in counties with universities than those with neither universities nor community colleges. The analysis by occupation shows that the effect of university closures is large in most occupations, but especially in teaching and research, sales, and restaurant occupations. The increase in UB applicants due to the university closures is also more prominent in small and medium-sized establishments with less than 300 employees