The impacts of macroeconomic determinants towards unemployment rate in seven selected ASEAN countries from 1996 until 2015 / Nur Afifa Athirah Matdali

The main objective of this paper is to examine the impacts of macroeconomic
determinants towards the unemployment rate for the case of selected ASEAN
countries form year 1996 until 2015. It was revealed that unemployment problem is
still a burden to almost all countries in ASEAN although it is consists of developed
and developing countries but those countries are still unable to reduce their
unemployment problem. Hence, this study includes five macroeconomic determinants
that consists GDP growth, population growth, inflation rate, foreign direct investment
(net inflows) and trade as the independent variable for unemployment in order to
investigate their impacts on unemployment rate for the case of selected ASEAN
countries.
By using cluster robust pooled OLS model, it was found that all the variables are
negatively related with the unemployment rate except for trade. Only gross domestic
product and population growth are significantly related to unemployment rate in this
study. It was appeared that population growth affect the unemployment rate the most
compare to other variables. From the findings, this study suggests to the government
and policymakers to take appropriate actions to increase the population growth in the
selected ASEAN countries in order to reduce the unemployment problem. It includes
providing a better medical facilities, enhance awareness of healthy lifestyle to the
people and expansionary monetary policy.