This study aims to assess the impact of economic growth and inflation on
unemployment in Somalia by testing the Phillips curve and Okun’s law hypothesis
utilizing the autoregressive distributed lag (ARDL) model and time series data
covering the period from 1991 to 2017. The empirical results reveal the existence of
long-run cointegration among the variables. Moreover, a negative relationship is
established between economic growth and unemployment both in the short run and
long run, hence confirming the validity of Okun’s law hypothesis in Somalia. The
impact of inflation on unemployment is inconsequential in the long run, although a
strong negative association exists in the short run, thus supporting the presence of the
Phillips curve hypothesis in Somalia in the short run. The study recommends that
policymakers should enact policies that favor economic growth to mitigate
unemployment and create a balance between the required level of inflation and
unemployment in Somalia.