Economic Determinants of Unemployment: Empirical Result from Pakistan

Abstract

Unemployment is one of the major issues that give birth to many economic and social problems in Pakistan economy. Keeping in view this serious problem, the author explored the factors that influence the level of employment in Pakistan. This study finds out the determinants of employment in Pakistan by applying simple multiple linear regression models using the time series data from 1990 to 2013. The result indicates that the relationship between literacy rate and population growth rate was positive and highly significant with unemployment rate while GDP was positive but insignificant impact on unemployment rate. The relationship between inflation and unemployment was negative but highly significant impact on unemployment.

Keywords: Growth rate, Inflation, Unemployment, Pakistan