| Author(s): Dr. Bhola Khan
Abstract: In this article, an attempt is made to identify the of Effect of Unemployment on Economic Growth in Nigeria from 1999-2015. Therefore, the Gross Domestic Product (GDP), Unemployment rate Government Expenditure and Money Supply are used as variables to find the effect of unemployment on economic growth. For this purpose, Ordinary Least Square regression technique and for checking stationarity in data Augmented Dickey−Fuller (ADF) unit root test was used and after careful analysis of the data the result shows that unemployment having a negative and insignificant impact on economic growth. At one per cent increase in unemployment lead to 0.04 per cent decrease in Gross Domestic Product (GDP) this is in line with a prior expectation. This implies that when unemployment increase is bringing the falling down the level of GDP in the economy. The study recommends that the concerted effort should be made by policy makers to increase the level of output in Nigeria by improving productivity/supply in order to reduce unemployment and the prices of goods and services (inflation) so as to boost the growth of the economy. Another policy implication of this study is that government should embark on labor intensive technique of production as against capital intensive and also close the border to some extent which is the likely measure to reduce unemployment and Inflation and increase domestic output level (GDP).
Keywords: Unemployment, Economic Growth, Ordinary Least Square, Gross Domestic Product