PhD Seminar (Econ)
Date & time
Extensive studies have explored the impact of the Covid-19 pandemic on firms’ performance, but none have discussed the role of firms’ operating flexibility on employment. Using the ASEAN-5 firms’ data from Q1-2018 to Q3-2021, this study analyses the links between the Covid cases, mobility restriction, and firms’ performance, their evolution over time, and the contribution of operating flexibility on firms’ profit and employment. As expected, the revenue and profit of firms in the country with a higher number of cases and a higher degree of restriction are lower, which is then translated into employment. Every 10 per cent revenue decline causes employment reduction by approximately 1 per cent. Further, the impact is influenced by the firms’ flexibility to adjust their costs. Firms with inefficient inventory management hire fewer workers by around 5 per cent. It is argued that the structural-driven supply-chain inefficiencies in some countries have worsened and prolonged the firms’ losses and unemployment.