firm financial statements to augment the set of firm-level outcomes considered. This is a longitudinal database covering all private formal firms and including information on firm financial characteristics that we use to construct measures of productivity, profits, and nonlabor inputs. We link this firm panel database with the IESS firm panel database based on a common unique firm identifier. We merge the location information in the firm registry to the worker panel database. A couple of definitions of variables used for firm outcome measures differ slightly from Brazil are: capital is defined as purchases of capital goods minus sales and disposals for any purpose, plus values registered by the assets constructed by the employees of the firm and value added defined as gross revenues minus intermediate input expenses.

Our analysis for Ecuador relies on more than 89 thousand observations (about 795 thousand worker-year observations) as seen in Appendix Table E1. On average workers are employed 9.2 months per year and the sample includes 13% of observations with zero months worked. Average monthly real earnings are 1,059 in 2010 USD. Appendix Table E2 shows the workers in the Ecuadorian sample average 33 years of age, with a third being female and 11% having a higher education degree. Workers were employed in the formal sector about 80% of the time before the GFC. Firms have on average 129 workers and 73% of firms are importers. Firms experience on average substantial annual growth in employment prior to the GFC. We ensure the representativeness of our IESS worker panel database by showing that the demographics and job characteristics of workers in the worker sample for Ecuador are similar to those of workers in the complete IESS database. In unreported estimates we find that estimates from standard Mincer wage regressions on the Ecuador worker panel show expected patterns: e.g., a male wage premium of 15% and a higher education premium of 75%.

We estimate Equation (2) using the Ecuador worker database and show the results in Appendix Figure E1 and Table E3. The negative coefficients in Panel A of Appendix Figure E1 show that Ecuadorian workers initially employed by harder-hit firms experience a persistent reduction in months worked until 2017, relative to workers in less hard-hit firms. The effects on worker months worked become more negative over time, although the hypothesis that all effects are similar across years cannot be rejected. The point estimates imply that an Ecuadorian worker whose initial firm faced a 10 percentage-point worse shock, worked in the . formal sector between 2009 and 2017 for a total of 6.1 fewer total months (7% fewer months).<sup>48</sup> But GFC firm shocks do not significantly affect workers’ real wages in Ecuador. These baseline effects for workers in Ecuador are robust to a series of checks shown in Appendix Table E4.

Allowing for heterogeneity across worker types in the adjustments to GFC firm shocks through the estimation of Equation (5), we find a strong negative adjustment of employment

> 48This calculation uses the point estimate for 2017 in the months worked regression of -0.068 and the average number of months worked of 9.2 from Appendix Table E1

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