Youth Unemployment and Income Inequality: Exploring the Linkages in Tanzania

Abstract

This study investigates the intricate relationship between youth unemployment and income inequality in Tanzania, aiming to understand the underlying linkages and evaluate the efficacy of various policy responses. Using a time series analysis, the study models the youth unemployment rate as the dependent variable, with GDP growth rate, inflation rate, income inequality, youth literacy rate, government expenditure on education, and population growth rate as independent variables. Data spanning from 1990 to 2022 are collected from reputable sources, including the World Bank and the Tanzania National Bureau of Statistics. Preliminary findings suggest significant correlations between youth unemployment and key economic indicators, particularly GDP growth and government expenditure on education. The result revealed that income inequality significantly affect youth an employment. This might occur due to the implementation of government policy such as redistributive policy which aims to promote social equity, reduce poverty and ensure fir allocation of resources within the society.