Modeling and forecasting the effect of COVID-19 in the Ecuadorian labor system

Abstract

COVID-19 has caused massive disruption at different levels. Scholars around the world have produced a significant number of studies to understand, reduce and predict the effects of this pandemic. Prediction models are crucial at this time of uncertainty, and labor indicators are key macroeconomic variables to plan the recovery of the effects of COVID-19. This study aims to model and predict the trend of the Ecuadorian labor system. The statistical analysis model applied for this study was the X-13ARIMA to predict the behavior of four indicators of the Ecuadorian labor system and establish their natural tendency by isolating the COVID-19 variable and determining the quantitative impact of the pandemic. The results show that the labor system was greatly affected by the COVID-19 outbreak; however, a deterioration was already observed in full employment and expanded underemployment. The study concludes that the pandemic altered the seasonality of the labor indicators.