COVID-19 pandemic and unemployment rate prediction for developing countries of Asia: A hybrid approach

Unemployment is an essential problem for developing countries, which has a direct and major role in economy of a country. Understanding the pattrens of unemployment rate is critical now a days and has drawn attention of researcher from all fields of study across the globe. As unemployment plays an important role in the planning of a country’s monetary progress for policymakers and researcher. Determining the unemployment rate efficiently required an advance modeling approach. Recently,numerous studies have relied on traditional testing methods to estimate the unemployment rate. Unemployment is usually nonstationary in nature. As a result, demonstrating them using traditional methods will lead to unpredictable results. It needs a hybrid approach to deal with the prediction of unemployment rate in order to deal with the issue associated with traditional techniques. This research primary goal is to examine the effect of the Covid-19 pandemic on the unemployment rate in selected countries of Asia through advanced hybrid modeling approach, using unemployment data of seven developing countries of Asian: Iran, Sri Lanka; Bangladesh; Pakistan; Indonesia; China; and India,and compare the results with conventional modeling approaches. Finding shows that the hybrid ARIMA-ARNN model outperformed over its competitors for Asia developing economies. In addition, the best fitted model was utilised to predict five years ahead unemployment rate. According to the findings, unemployment will rise significantly in developing economies in the next years, and this will have a particularly severe impact on the region’s economies that aren’t yet developed.