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COVID-19: The Challenges and Changes the Labor Market Has Faced

Job Market
Jan 18, 2021

The pandemic, and the various lockdowns around the world, have had a dramatic impact on the labor market. In fact, the pandemic has caused radical restructuring and division when it comes to people in work worldwide. 

Some individuals have continued to work but do so from home, and others have lost their jobs. The labor market today is very different from the labor market pre-COVID. The past few months have been challenging for the labor market and many more changes are likely to occur, if they haven’t already occured, in the coming months. 

In this article we will look at some of the pressing challenges and changes that the labor market has faced over the past few months. 

Remote Work

As soon as it became clear that COVID-19 was spreading at speed, companies had to make a drastic decision about their workforces — send employees home to work and set up online services for employees to use (video chat tools, for example). 

While this new and innovative approach appealed to many people, and it was a great help in stopping the spread of the virus, the transition to remote work was not always smooth. In fact, there were many companies and people that found adjusting to this new way of life quite difficult.

Remote work was, and still is, incredibly challenging for all involved because not every person is used to doing it, and there have been some people who have never worked remotely. While a lot have embraced the new changes, there are many who have not been so happy, and this has caused some divide amongst employees across workforces. 

Returning to work in an office is not likely to happen anytime soon, so remote work will continue for most people. It's important that we all try and familiarize ourselves with the tools and new work practices, so that we can do our jobs to the best of our abilities.  

Remote Work: Working Well 

Remote work, as the name suggests is when you work from home. For a lot of the labor market they would’ve been given tools and equipment to work with at home. For example, Facebook has allowed its employees to work from home until July 2021 and each worker has been promised $1000 to arrange a home office, and the same was done by Google.  

For these employees working from home will be less stressful in terms of the tools they need to use because they will have access to most things that they need. Plus, they’ll be able to create a great and comfortable home office setup! This can serve to increase productivity and to help workflow. 

Remote Work: Not Working So Well

As mentioned before, the road to remote work has not been easy for every employee in today’s labor market. Here are some issues that some individuals have faced:

Not all companies could afford to hand out laptops, phones and other equipment to employees, so this impacted workflow. Without the correct tools, some employees felt that they were not able to fulfill their duties correctly, and this caused great unease for some. 

While not having the right tools may have been an issue, the actual act of working alone and at home caused great stress for other individuals. 

For example, a lot of people like the social-buzz of work, so working completely alone in isolation gave rise to issues that were not present before COVID-19. This led to increased stress and sickness levels, which again impacted the labor market. In some cases, people left their roles to go and work somewhere else because they could not cope. 

These issues impacted the workflow and the productivity levels of some employees, and this remains to be a very difficult challenge to overcome in this era of uncertainty. 

It’s important to look at ways of dealing with stress and anxiety, so that working from home can become a little more pleasant. Things like taking a walk and staying in contact with family and friends are important! There are also advice pages online that specialize in helping people to feel more at ease when working at home, so it would be worth looking at these.  

Management and Leaders

The labor market has changed drastically over the past few months and it has been particularly challenging for those working in senior positions. 

Managers and other leaders have had to deal with completely new problems this past year, and in doing so, they have had to learn new ways of dealing with a challenging and changing workforce.  

For example, above it was noted that not everyone likes to work remotely as the constant working alone causes stress, and individuals just don’t like it. This is an issue that managers and the likes, were and are still not so familiar with, because under normal circumstances the person would just go into the office to work and would not feel so alone as their colleagues would be there too.

These challenges are difficult for managers to deal with because there isn’t really a straightforward answer. No manager wants to hear about a distressed employee, yet, the employee cannot go into the office, so what should be done? Not being able to help an employee doesn’t make a manager feel good, and they can feel like they are not performing their managerial duties. This is not a good feeling. 

Additionally, those who have got on board with working from home might have had a lot of issues with getting tools to work properly. This then takes a manager a lot of time and effort to explain to an employee what to do, which is quite stressful and time consuming. 


There are three approaches towards recruitment at the moment: companies have temporarily frozen their recruitment activities, companies have stopped recruiting, and other companies have continued searching for new employees and even expanded their workforce. 

The type of approach depends on the type of industry you’re in, for example, ecommerce and couriers, are doing well and are looking at recruiting people. Streaming platforms are also growing, as games and entertainment are in high demand, and enterprises that work with cloud technologies either remain unaffected or have experienced an increase in user activity. 

However, there are other industries who haven’t managed as well, tourism, for example. Recruitment in this sector has not improved and has suffered because we’re limited to local areas when traveling. Which means we don’t need tour companies, holiday parks and the likes right now!  

Finding a solution for the tourism industry, for example, is a massive challenge right now, and the current situation this industry is in is likely to continue until we can all move around the world more freely.  


With the pandemic hitting us all with its full force, the majority of us have had no choice but to work from home and to do things differently. Yet, this has been quite a challenge all by itself. 

While those who are tech orientated love using all the new apps and tools that are being used globally by companies, not everyone has found adjusting to using virtual apps and video chats that easy.

Using all these new tools, that some people in the labor market may never have heard of before, has been quite stressful. Imagine trying to set up a camera so that you can be in a virtual meeting with 30 other people, yet you don’t know that you need to sign up to an app, to then use a code to access the meeting… it can be confusing, especially when you are not used to it. 

And this has sadly been the case for a lot of people. 

Adding to the fact that you then have to use the tools to ring someone for help is also just added stress. 

However, there are others that would say that using all of these tools has improved the productivity of the labor market. It’s hard to give a definitive answer.

Industries That Have Been Hit Hard

Things are bad for industries like tourism, hospitality, musicians, and artists, especially independent ones. Many people have lost their jobs, and while wealthier countries offer some kind of financial support, poorer states have not been able to offer their working population the same support. 

As noted earlier, there isn’t really a clear solution to fix the issues in these industries right now. Which means for those working in these sectors, they’re either on some government scheme, or they are going to lose their jobs because no customers coming in equals no profit, which means you don’t need a big workforce. 

A large proportion of the labor market actually works in the sectors above too, so something needs to be done sooner rather than later, or the unemployment rate will increase. 

A Job Interview During the Pandemic

Well, if job interviews did not have to be re-invented, they definitely had to be reconsidered. Here is what a job interview typically looks like nowadays:

  • An application is filled in
  • A candidate goes through some sort of online test 
  • There is likely to be a video interview with a recruiter
  • A presentation may be given via an online tool
  • There could be a video interview with the future leader
  • You might have to demonstrate your skills in a group
  • The final stage is typically a video interview with the head of the department

As you can see the process has changed considerably, and while it may not seem too challenging there are some struggles with doing interviews during a pandemic. The list below is likely to impact how an interview goes, and don’t forget, even though you're at home you must still be professional.

Some things to think about are:

  • Technology needs to be working correctly
  • Where do you do your interview?
  • Background distractions
  • Getting everyone ready on time for an interview
  • Build rapport with an interviewer 

Getting To Know A New Team

While it is great news for the labor market that companies are still recruiting new people, it can be difficult to introduce new team members to each other. 

In normal circumstances people would meet face to face, shake hands, get a coffee, sit around and chat, and perhaps they’d take a tour of the building together. None of this will happen now. 

The process of getting acquainted with the team has changed so much that it is now likely to take place via an app that has probably got a video function. The new employee will get access to everything they need through some sort of online portal, and they’ll chat with their team through a group chat system.  

This is very clever, but it isn’t the most sociable of things. And doing things in such a way can be so impersonal that members of a team find it hard to bond with each other, which can lead to further challenges for the team and any managers.

The Hiring Process

As you know, there are many companies still hiring, and while this may seem like a good thing it has not been without its challenges. When hiring the following issues have occured:

  1. Slow hiring process. There are so many people out of work, which means loads of people are going to apply for the jobs that are available. With so many applications to go through it’s no wonder that the hiring process is slow. 
  2. It’s a challenge to schedule interviews and to conduct them. Everything will be done online, so whoever is doing the interviewing needs to ensure that everything is okay on both sides. A simple thing like a microphone not working is going to make a big difference in an interview!
  3. Not everyone can participate in online interviews. For example, an individual may not have a laptop with a camera, this challenge must be overcome to ensure that the individual gets a fair chance at the interview. A restructuring of the interview might be needed, so that everyone is treated equally. 
  4. The process of onboarding a new employee has become more difficult. Joining the company, becoming "one of us," adjusting to the conditions of work and new people has become more complicated. It is harder to build rapport and not everyone feels comfortable communicating via video chat. 

But every cloud has a silver lining, so let’s finish on a positive note by looking at the positive effects the pandemic has had on the Labor Market...

  1. Remote work means that there is no need to spend time commuting to work everyday.
  2. There are no travel expenses to pay.
  3. It is easier to arrange an interview and sometimes they can be done within hours.
  4. All documents can be uploaded and sent to an employee when needed, so no time wasting. 
  5. While the hiring process may require more time, you do get access to a lot more talent. 
  6. Due to the increased interest in online work, a candidate from any city/region/country can apply for a job in the USA. Obstacles like visas, work permits, are no longer a problem.
  7. Vast amount of tools that can be used now to aid individuals at work.
  8. Remote work could become a more permanent feature of life! 

New Ways of Succeeding In These Challenging and Changing Times

While it has been a challenging time for many, there have been a number of people who have changed the challenges of the pandemic into opportunities. 

For example, those who may have lost their jobs, and have needed to earn more money, have turned to things like Patreon. 

Patreon is the world's largest platform where creators can earn money from their audience. To join the platform, you need to create interesting content and subscribers then pay for it. During the first lockdown, about 30,000 new creators joined Patreon. 

Patreon will be fairly new to some of you, but it's actually been a lifesaver to those who use it, as you can earn a decent monthly salary on there. This new trend has shown that there are opportunities in this dark time, and all you need to do is think about some different routes to take in life. 

Another example is Walmart. This is one of America’s biggest retail chains and it has become incredibly popular during the pandemic. 

Due to lockdown and other restrictions, the majority of Americans have to eat at home and cook for themselves. This has resulted in an increase in online sales of convenience and pre-prepared food. The net income of Walmart rose to $ 6.5 billion beating all analysts' expectations. 

In terms of what this means for the labor market, more people have gone to work here, so that the company can keep up with the demands and orders that come from customers. This has improved the labor market because the shopping industry is incredibly important to the economy.

Finally, many people have turned to online work since they have lost their jobs in the COVID-19 crisis. This new way of working is becoming more and more popular, and the pandemic has certainly helped to increase its popularity.  


The COVID-19 crisis has certainly impacted the labor market in many ways, but in these challenging times it's important to look at the positive things too. 

Over the past few months many industries have fallen because of the pandemic, but many new industries have been explored by people. Working online, and earning money through things like Patreon are just some examples of jobs that people may not have considered doing before the COVID crisis. 

If you have lost your job, or you’re unhappy with your current role and you fancy a change, don’t be afraid to look out there for new opportunities! You might be surprised by the vast opportunities that are out there right now.

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