The impact of COVID-19 on the labour market and the role of E-commerce development in developing countries: Evidence from Indonesia

Abstract

This paper assesses the impact of covid-19 pandemic, measured through work mobility reduction, and e-commerce growth on the labour market using data from Indonesian labour force surveys and e-commerce transaction values. The findings confirm that the pandemic adversely affects workers’ employment prospects, work hours, total earnings, and hourly earnings. E-commerce growth does not counteract the adverse impact of the pandemic as expected, but it plays a role as an employment buffer during the crisis, although it tends to suppress workers’ earnings. Our results imply that more efforts are needed to improve the productivity of workers involved in e-commerce.