Internet utilization and Indonesian female entrepreneurs during the COVID-19 pandemic

Abstract

AbstractThe spread of COVID-19 was a severe setback to the labour market in the globe, including Indonesia. The policies implemented to prevent the spread of the virus have compelled the society to shift towards digital and internet-based activities. The rapid growth of digital technology and internet utilization presents a new potential for women to participate more actively in the labour market, particularly in entrepreneurial activities. This study has two objectives. First, this study examines the effect of using the internet on the participation of female entrepreneurs during the pandemic. Second, this study examines the relationship between internet utilization and income among female entrepreneurs. The data used in this study are individual data sourced from the 2020 National Labour Force Survey (Sakernas). A probit regression model is used to answer the first objective, while the correction for Heckman selection bias has been made when estimating the income equation in the second objective. The results of the first objective show that women who use the internet have a greater chance of becoming entrepreneurs than women who do not use the internet. The impact is higher for women living in urban areas. The finding in this study also emphasizes several important aspects that can encourage the growth of female entrepreneurs, such as training, experience, age, and marital status. Second, this study shows that female entrepreneurs who use the internet tend to have higher incomes. Females that have potential to have higher incomes by using internet are working in trade, food and beverages, and industry sectors.

Keywords

• COVID-19 pandemic
• female entrepreneurs
• internet
• income
• probit