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How resilient is the labour market against natural disaster? Evaluating the effects from the 2010 earthquake in Chile

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Abstract

Natural disasters are one of the main channels through which ecological and socio-economic systems interact. In particular, the severe impacts of earthquakes could disrupt activities in the labour market. However, the literature barely researched the long-term effects of such events. To investigate this issue, this article is concentrated in Chile that is subject to recurring seismic movements. The 27 February 2010 Bío-Bío Chile earthquake (Mw 8.8) was the second strongest in the history of the country. This natural disaster can be used to evaluate the response of the labour market to an exogenous shock. Besides, the capacity for resilience in the labour market is crucial for people who rely on their job. This document analyses the impacts of the 2010 Bío-Bío earthquake and tsunami on Chilean labour market outcomes, in particular, the quality of employment. With this objective, different data are combined for analysing the effect in the short and long term. Also, distinct econometric techniques and exogenous measurements of seismic acceleration are used. The evidence shows that these catastrophes harmed the labour market in the short term. However, in the long term, the government’s reconstruction efforts and other factors could have attenuated the adverse effects over some variables in the most affected zones.

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Fig. 1

Source: own elaboration based on Scopus and Web of Science

Fig. 2

Source: Own elaboration based on USGS Shakemap data

Fig. 3

Source: Own elaboration based on USGS Shakemap data

Fig. 4

Source: own elaboration based on CASEN

Fig. 5

Source: own elaboration based on USGS Shakemap data

Fig. 6

Source: own elaboration based on CASEN

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Notes

  1. By counting only once the studies in both databases, the final sample involved 118 articles.

  2. Although other earthquakes occurred between 2011 and 2017 in Chile, these did not produce severe damage to housing and infrastructure or loss of life, such as the 2010 Bío-Bío earthquake.

  3. Since the tsunami-affected cities and coastal towns in the regions of Maule and Bío-Bío that were also affected by the earthquake (ECLAC 2010), the treatment and control group identified using these parameters is expected to be similar to those that would arise if similar measures related to the tsunami were available.

  4. In the robustness check section, other quartiles were used as thresholds.

  5. To obtain these results, 2015 CASEN survey was used with information on the place of residence 5 years ago, that is, in 2010, when the earthquake and tsunami occurred.

  6. This expenditure is related to the reconstruction activities of public infrastructures that were carried out after the earthquake and tsunami. Indeed, the regional expenditure per capita (in constant pesos) of the Ministry of Public Works of Chile shows a significant increase in the affected regions after 2009. Although it would be convenient to have an adequate measure of the total public consolidated expenditure during the recovery process, it is not easy to collect all the necessary information per community (and even per region).

  7. This estimation is available upon request.

  8. This estimation is available upon request.

  9. This information came from Ministry of Housing and Urbanism (2019).

  10. This variable allows controlling for regional differences in the level and temporal change of the value of exports from the agricultural sector during the period of analysis. Although the variable does not capture what happened to the exports of the rest of the sectors, in the affected regions, the share of the agricultural sector in exports is considerably higher than in the control group regions. Moreover, the affected zones comprised 40% of national employment in the agricultural sector (ECLAC 2010).

  11. As mentioned previously, although it would be convenient to have an adequate measure of the total public consolidated expenditure executed by the government during the recovery process, it is very difficult to collect all the necessary information per community (and even per region) throughout all period of analysis.

  12. The Mercalli intensity was used as instrumental variable by Kirchberger (2017) and treatment variable by Porcelli and Trezzi (2019). However, this measure could be potentially endogenous because it is related to the effects of an earthquake on people or structures.

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Funding was provided by Comunidad de Madrid.

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Authors and Affiliations

  1. Department of Topographic Engineering and Cartography, Polytechnic University of Madrid, Madrid, Spain

    Maribel Jiménez Martínez & Rocío Romero-Jarén

  2. External Consultant International Labour Office, Buenos Aires, Argentina

    Mónica Jiménez Martínez

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  1. Maribel Jiménez Martínez
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  2. Mónica Jiménez Martínez
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  3. Rocío Romero-Jarén
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Correspondence to Maribel Jiménez Martínez.

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Appendix

Appendix

See Tables 4, 5, 6, 7, 8, and 9.

Table 4 Baseline characteristics of treatment and control group, 2009.
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Table 5 Effect of the 2010 Bío-Bío earthquake and tsunami on probability of migration from a community of the affected area
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Table 6 Short-term effects of the 2010 Bío-Bío earthquake and tsunami on labour market with additional controls
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Table 7 Long-term effects of the 2010 Bío-Bío earthquake and tsunami on the labour market with additional controls
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Table 8 Effects of the 2010 Bío-Bío earthquake and tsunami on labour market considering the number of rebuilt houses
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Table 9 Long-term effects of the 2010 Bío-Bío earthquake and tsunami on labour market by different pre-event periods.
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Jiménez Martínez, M., Jiménez Martínez, M. & Romero-Jarén, R. How resilient is the labour market against natural disaster? Evaluating the effects from the 2010 earthquake in Chile. Nat Hazards 104, 1481–1533 (2020). https://doi.org/10.1007/s11069-020-04229-9

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