Effective Inflation Management

Oct 13, 2025 by windailys.com 64 views

The Influence of Economic Globalization on the Level of Unemployment in 6 ASEAN Countries

Introduction

In today's interconnected world, economic globalization has become an inevitable phenomenon, impacting various aspects of life, including the labor market. The six ASEAN countries, namely Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam, have been significantly affected by this trend. This study aims to determine the extent of the influence of economic globalization, economic growth, and inflation, both in the long run and short term, to the unemployment rate in these six ASEAN countries. Using a quantitative descriptive approach, this study analyzed secondary data from 2007 to 2021, with the Autoregressive Distributed Lag (ARDL) method to understand the dynamics of unemployment in the region.

Research Methodology

In this study, the six ASEAN countries that sampled were elected purposive sampling out of a total eleven ASEAN member countries. The data used comes from reliable sources such as ETH Zurich and World Bank, providing high accuracy and relevance to the results of the analysis. By utilizing time series data, this research seeks to identify the pattern and the relationship between the variables being studied.

The Impact of Economic Globalization on Unemployment

Economic globalization has been shown to have a significant negative impact on the unemployment rate in the six countries in the long run. This suggests that the higher the level of involvement of a country in the global economy, the more pressure faced in the labor market, may be caused by an increase in automation and transfer of work to countries with lower labor costs. This is a critical finding, as it highlights the need for ASEAN countries to adopt effective strategies to deal with the challenges arising from economic globalization.

The Role of Economic Growth in Unemployment

Conversely, economic growth has been proven to have a positive impact, although not significant, on the unemployment rate. This might indicate that although economic growth can create new jobs, the amount of work produced may not be enough to absorb the amount of unemployment that continues to grow, especially in the context of developing countries. This is a complex issue, as economic growth can have both positive and negative effects on unemployment.

The Impact of Inflation on Unemployment

On the other hand, short-term analysis reveals that inflation from the previous period has a positive and significant impact on the unemployment rate. An increase in inflation can reduce people's purchasing power, which in turn affects the demand for goods and services, and has the potential to reduce labor demand. This shows the need for a better policy in managing inflation to create a more conducive climate for employment growth.

Conclusion

Overall, this research highlights the importance of understanding the relationship between economic globalization, inflation, and unemployment in ASEAN countries. With increasing globalization, these countries need to adopt effective strategies to deal with challenges that arise, including proper inflation management and policies to create inclusive jobs. Thus, it is hoped that globalization can be an opportunity that not only increases economic growth, but also reduces the level of unemployment in the region.

Recommendations

Based on the findings of this study, the following recommendations are made:

Effective Inflation Management: ASEAN countries need to adopt effective policies to manage inflation, including monetary and fiscal policies, to create a more conducive climate for employment growth.
Inclusive Job Creation: Governments need to create policies that promote inclusive job creation, including job training programs and entrepreneurship development initiatives.
Globalization Strategies: ASEAN countries need to adopt effective strategies to deal with the challenges arising from economic globalization, including automation and transfer of work to countries with lower labor costs.
Research and Development: Further research is needed to understand the dynamics of unemployment in ASEAN countries and to identify effective policies to address this issue.

Limitations of the Study

This study has several limitations, including:

Data Limitations: The study used secondary data from 2007 to 2021, which may not reflect the current situation in ASEAN countries.
Methodological Limitations: The study used a quantitative descriptive approach, which may not capture the complexities of the issue.
Sampling Limitations: The study used purposive sampling, which may not be representative of the entire ASEAN region.

Future Research Directions

Future research should focus on:

Understanding the Dynamics of Unemployment: Further research is needed to understand the dynamics of unemployment in ASEAN countries and to identify effective policies to address this issue.
Effective Globalization Strategies: Research is needed to identify effective strategies to deal with the challenges arising from economic globalization.
Inclusive Job Creation: Research is needed to identify effective policies to promote inclusive job creation in ASEAN countries.

Conclusion

In conclusion, this study highlights the importance of understanding the relationship between economic globalization, inflation, and unemployment in ASEAN countries. With increasing globalization, these countries need to adopt effective strategies to deal with challenges that arise, including proper inflation management and policies to create inclusive jobs. Thus, it is hoped that globalization can be an opportunity that not only increases economic growth, but also reduces the level of unemployment in the region.
Frequently Asked Questions (FAQs) on the Influence of Economic Globalization on Unemployment in 6 ASEAN Countries

Q: What is economic globalization and how does it affect unemployment?

A: Economic globalization refers to the increasing interconnectedness of the world's economies through trade, investment, and technology. It can lead to an increase in unemployment as companies outsource jobs to countries with lower labor costs, and automation replaces human workers.

Q: What are the main findings of the study on the influence of economic globalization on unemployment in 6 ASEAN countries?

A: The study found that economic globalization has a significant negative impact on unemployment in the long run, while economic growth has a positive impact, although not significant. Inflation from the previous period has a positive and significant impact on unemployment in the short term.

Q: What are the implications of the study's findings for ASEAN countries?

A: The study's findings suggest that ASEAN countries need to adopt effective strategies to deal with the challenges arising from economic globalization, including proper inflation management and policies to create inclusive jobs.

Q: What are some of the challenges facing ASEAN countries in terms of unemployment?

A: Some of the challenges facing ASEAN countries in terms of unemployment include:

High levels of youth unemployment
Limited job opportunities in certain sectors
Inadequate education and training programs
Limited access to social safety nets

Q: What are some of the recommendations of the study for ASEAN countries to address unemployment?

A: The study recommends that ASEAN countries adopt effective policies to manage inflation, create inclusive jobs, and deal with the challenges arising from economic globalization.

Q: What are some of the limitations of the study?

A: The study has several limitations, including:

Data limitations: The study used secondary data from 2007 to 2021, which may not reflect the current situation in ASEAN countries.
Methodological limitations: The study used a quantitative descriptive approach, which may not capture the complexities of the issue.
Sampling limitations: The study used purposive sampling, which may not be representative of the entire ASEAN region.

Q: What are some of the future research directions suggested by the study?

A: The study suggests that future research should focus on:

Understanding the dynamics of unemployment in ASEAN countries
Identifying effective globalization strategies
Promoting inclusive job creation in ASEAN countries

Q: What are some of the policy implications of the study's findings?

A: The study's findings have several policy implications, including:

The need for ASEAN countries to adopt effective policies to manage inflation and create inclusive jobs
The need for ASEAN countries to deal with the challenges arising from economic globalization
The need for ASEAN countries to invest in education and training programs to prepare workers for the changing job market.

Q: What are some of the potential benefits of economic globalization for ASEAN countries?

A: Some of the potential benefits of economic globalization for ASEAN countries include:

Increased economic growth and trade
Improved access to new markets and technologies
Increased investment and job creation

Q: What are some of the potential risks of economic globalization for ASEAN countries?

A: Some of the potential risks of economic globalization for ASEAN countries include:

Increased unemployment and job insecurity
Increased income inequality
Decreased economic sovereignty and control over domestic policies.