COVID-19 Vaccination and Economic Recovery in Latin America: Evidence from the 2021 HFPS

During 2021, most Latin American countries successfully deployed vaccines and their labor markets began to recover from the COVID-19 slump. Using two waves of the 2021 HFPS, we investigate the connection between immunization and employment recovery. We first show the highly uneven social impact of the recession and document the beginning of employment recovery during the second half of 2021. We also find that immunization rates increased rapidly during the same period, but remained significantly lower among economically disadvantaged individuals, primarily due to insufficient awareness of how to access the vaccine. Our individual-level analysis also indicates that vaccination allowed for a faster return to work, suggesting that lagging vaccination rates may have been an impediment to the full recovery of the employment and earnings of economically disadvantaged individuals. JEL Classification Codes: O12; O17; J7; I1; I18