Entrepreneurial intention of unemployed people and training and financial support for self-employed workers in COVID-19 times

Abstract

The COVID-19 pandemic has caused a severe economic crisis that led to instability in the labor market, putting at risk the welfare of workers. Some workers fell into unemployment and self-employed workers had to face a partial or total stoppage of their activities. In this framework, unemployed people could find a way out of unemployment in entrepreneurship. As for self-employed workers, they need support to reactive economically. This paper aims to study the entrepreneurial intention of unemployed people and the need of training and financial support of self-employed workers. To do so, Probit models are estimated using a national survey on workers in Ecuador. The results show that the underlying characteristics that motivate the entrepreneurial intention differ across existent unemployed people and COVID-19 unemployed people. COVID-19 unemployed women are more likely to have entrepreneurial intentions than men. Less educated existent unemployed people are more likely to have entrepreneurial intentions than more educated ones. The results regarding the need of support of self-employed people show that people that need financial support also need training support and vice-versa. The COVID-19 affectation on economic sectors has a relevant effect on the need for financial support.