Trade Openness and Employment Nexus in Saudi Arabia

Trade openness would increase the welfare of nation if it could also support the employment in the long run. This research explores the net effect of trade openness on the Saudi employment by using annual data of 1980-2015 and by using ARDL cointegration technique. Trade openness, government spending on education and economic growth have positive impacts on the employment in long run while mix evidence of these variables are found on employment in the short run with different lag effects. Based on results, we recommend the government to raise the trade openness by removing trade barriers and to increase spending on the education sector to support the higher employment level in the Kingdom