Population Growth and Unemployment in Uganda: Evidence from an ARDL Bounds-Testing Approach, 1994–2023

Uganda has one of the fastest-growing populations in the world, yet the link between demographic expansion and joblessness remains thinly quantified. This study estimates the short- and long-run effects of population growth on the unemployment rate in Uganda over 1994–2023, controlling for real GDP growth, consumer price inflation and foreign direct investment (FDI). Annual data compiled from World Bank and United Nations sources were analysed with the autoregressive distributed lag (ARDL) bounds-testing approach, using finitesample critical values generated by Monte Carlo simulation. Unit-root tests returned a mixture of I(0) and I(1) series, and both the Akaike and Schwarz criteria selected an ARDL(1, 0, 1, 0, 0) specification. Population growth had a positive and significant short-run effect on unemployment (β = 1.007, p = .034), so that a 0.1 percentage-point rise in the population growth rate was associated with a 0.10 percentage-point rise in the unemployment rate. The error-correction coefficient (−0.516, p = .004) indicates that roughly half of any disequilibrium is corrected within a year. Evidence of a long-run level relationship was inconclusive in the baseline model but became strong once two outlying years (2005 and 2013) were controlled for; in that specification FDI lowered unemployment in the long run, while the long-run population coefficient remained positive but imprecise. Neither GDP growth nor inflation was significant, pointing to weak employment intensity of growth. The results support coupling population policy with investment-led job creation.