The Impact of Youth Unemployment on Pakistan's Economy

The objective of this research paper is to analyze the impact of youth unemployment on Pakistan's economy by using time series data of 29 years from 1990 to 2019. The unemployment was selected as dependent variable whereas annual population growth, interest rate, inflation, FDI, external debt and wages were selected as independent variables. Different statistical techniques such as Descriptive statistics, Correlation Analysis, ADF test, Bond test, ARDL model and Error Correction Model (ECM) were used to determine long run and short run relationship between variables. The findings of the study reveal that youth unemployment has significant negative effect on economic growth and the society in the long run. The study suggest that the government should create more jobs to reduce unemployment in the youth.