The Impact of Economic Growth on Unemployment in Jordan during the period 1980-2022

Abstract

This study aims mainly to reveal the impact of economic growth on Jordan's unemployment rates. By assessing Okun's Law during the period 1980-2022. Auto-regressive Distributed Lag Models (ARDL) were used to estimate the model. The results showed: that there is a long-term co-integration relationship between variables, where there is a long-term balance between variables at a 1% level. This means that the economic growth rate contributes to the creation of new jobs in Jordan. Jordan's high economic growth is helping to create new jobs. There is also an inverse correlation between Jordan's economic growth and unemployment rates according to the ARDL model. This means that an increase in economic growth rates by 1% leads to a decrease in unemployment rates by 0.15%. This means raising Jordan's economic growth rates contributes positively to addressing the problem of unemployment. The study recommended that the Government should take measures aimed at raising Jordan's economic growth rates. by stimulating aggregate demand by increasing levels of investment expenditure and attracting more foreign investment in order to create more jobs, Attention to small and medium-sized industries and their ability to do so accelerated the economy because they provide so many jobs education, and attention must be paid to education outputs in accordance with the needs of the labor market.