Polish Journal of Management Studies
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Abstracts > Vol 7

Analysis of correlation between the unemployment rate and gross domestic product IN THE EUROPEAN UNION
Iuga I., Cioca I.C.

Abstract: Vacancies, unemployment, wage levels and labor costs do not only affect a country's economy by lowering the Gross Domestic Product, but every persons life. The purpose of this paper is to analyze the Gross Domestic Product and unemployment rate in the European countries for the period 2005-2011. To perform the analysis, official data from Eurostat, National Statistical Institute and the National Agency for Employment in Romania were taken. The research objectives are to analyze the two indicators for 27 European countries, including Romania. The indicators obtained by Romania were analyzed and compared to the indicators registered by other countries. The expected results consist of establishing a link between GDP and unemployment rate. This link and the intensity of the link will be established by calculating and analyzing the correlation indicator.

Gross domestic product, unemployment, unemployment rate


Among European Union policy there is included that relating to employment following the introduction of a chapter on the labor market in the Treaty of Amsterdam in 1997. Europe and the whole world, since 2008, have passed through an economic and financial crisis, which apparently is ongoing. Years of economic and social progress have been affected by this crisis, highlighting the deficiencies of Europe's economy.
According to European Communication Commission [1], Europe Strategy 2020 puts forward three mutually reinforcing priorities: smart growth (developing an economy based on knowledge and innovation); sustainable growth (promoting a more efficient economy in terms of resource use, more ecological and competitive); inclusive growth (fostering an economy with a high rate of employment, to ensure social and territorial cohesion).
European Union needs to define where it wants to develop by 2020. In this perspective, the Commission proposes the following main targets for EU: 75% of the population aged between 20 and 64 should have a job, 3% of EU's GDP should be invested in research and development; rate of early school leavers should be under 10% and at least 40% of the younger generation should have higher education; the number of people at risk of poverty should be reduced by 20 million.
Miron Wolnicki, Eugeniusz Kwiatkowski and Ryszard Piasecki
[2], explain the sources of jobless growth in Poland, the country undergoing economic system transition and integration with the European Union .
Other papers examine the link between macroeconomic development and evolution of the unemployment rate: Hakan Berument, Nukhet Dogan, Aysıt Tansel [3], in their paper, check if various macroeconomic shocks have different effects on global unemployment and unemployment on different levels of education in Turkey. Persefoni V. Tsaliki [4] argues that unemployment is a systemic element of economic development and which does not need, and "normally" does not create, full employment of labor force, regardless of flexibility in labor markets. Misbah Tanveer Choudhry, Enrico Marelli, Marcello Signorell [5], in their paper, assess the impact of financial crisis on young people. The authors consider different types of financial crises and different groups of countries according to their income level

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From the analysis of GDP in Europe in 2011, we see that only highly industrialized countries have a high value of this indicator. Only 5 countries exceed the amount of 600 billion euros. In the year 2011 the value of the country's GDP in Poland is double than in Romania. Regarding the growth of GDP in 2011 compared to 2005, it appears that in only two countries the value of GDP decreased in 2011 compared to 2005: Ireland and the UK. In Romania, the development of GDP was fluctuating over the period 2005-2011. The highest value was recorded in 2008 (EUR 139753 million). In 2009 compared to 2008, GDP decreased by 17%, and in 2009 started to increase until 2011. And yet, the value in 2011 did not reach the level of 2008. In 17 countries, an increase in unemployment rate is noticed in 2011 compared to 2005: Bulgaria, Denmark, Estonia, Ireland, Greece, Spain, Italy, France, Cyprus, Latvia, Lithuania, Luxembourg, Hungary, Portugal, Romania, Slovenia and the UK. In Spain, unemployment rate has increased the most, compared to the other European countries, in 2011 from 2005, with approximately 12.5%. In Romania, the lowest unemployment rate was recorded in 2008. In 2011 this rate increased by 1.6% compared to 2005.


[1]. Communication from the Commission Europe 2020 A strategy for smart, sustainable and inclusive, European Commission, Bruxelles,, Access on: 15.03.2012
[2]. Miron Wolnicki, Eugeniusz Kwiatkowski and Ryszard Piasecki, Jobless growth: a new challenge for the transition economy of Poland, International Journal of Social Economics, Vol. 33, No. 3, 2006;
[3]. Hakan Berument, Nukhet Dogan, Aysıt Tansel, Economic performance and unemployment: evidence from an emerging economy, International Journal of       Manpower, Vol. 27, No. 7, 2006;
[4]. Jedlicka P., Kovarnik J., “The Role of Qualification and Education in the Development and the Solution of Unemployment of Graduates in Czech Republic”, Polish Journal of Management Studies, vol.5/2012.
[5]. Brzeziński S., Pietrasieński P., “Instruments for Supporting Foreign Investors in the Selected Central and Eastern European Countries”, W:Business in Central and Eastern Europe: Cross-Atlantic Perspectives. Monograph. Ed. by Bill KondellasNortheastern Illinois Univ.; Publish.Section of the Faculty of Managem. Częstochowa Univ.Techn.2011.
[6]. Persefoni V. Tsaliki, Economic development and unemployment: do they                   connect?, International Journal of Social Economics Vol. 36 No. 7, 2009;
[7]. Misbah Tanveer Choudhry, Enrico Marelli, Marcello Signorell, Youth unemployment rate and impact of financial crises, International Journal of Manpower, Vol. 33, No. 1, 2012;
[8]. Grabara J., Kot S., “Theoretical Frames for Designing Reverse Logistics Processes”, Spiru Haret University, Faculty of Management Brasov 2009.
[9]. Europe in figures Eurostat yearbook 2012, Eurostat Statistical books, European Union, 2012;
[10]. Law no. 76/2002 regarding the unemployment insurance system and employment stimulation of Romania, with subsequent modifications and completions, published in Official Gazette of Romania no.103 from 06.02.2002


Streszczenie: Miejsca pracy, bezrobocie, wysokość pensji i kosztów pracy nie tylko wpływa na kondycję krajowej gospodarki, poprzez obniżenie poziomu Produktu Krajowego Brutto, ale także na życie każdego człowieka. Celem niniejszego artykułu była analiza poziomu PKB i stopy bezrobocia w krajach Unii Europejskiej w okresie 2005-2011. Do przeprowadzenia analizy, wykorzystano oficjanle dane z Aurostatu, Narodowego Urzędu Statystycznego i Narodowej Agencji ds. Zatrudnienia. Celem badania jest analiza dwóch wskaźników dla 27 krajów europejskich, włączając Rumunię. Wskaźniki uzyskane przez Rumunię zostały zaanalizowane i porównanie do wskaźników osiągniętych przez pozostałe kraje. Osiągnięte wyniki charakteryzują się relacją między poziomem PKB a stopą bezrobocią. Ta relacja i jej intensywność jest ustalona poprzez obliczenia i analizę wskaźnika korelacji.

Słowa kluczowe: Produkt Krajowy Brutto, bezrobocie, stopa bezrobocia

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