The Effects of Globalization on Total Labor Demand, Skilled and Unskilled Labor in Iran

The phenomenon of globalization is one of the most debated issues facing countries in today’s world. There are many different opinions concerning this issue. Investigation of the extensive impacts of this process on different dimensions of human life in political, economic, social and cultural spheres has been preoccupying thinkers, politicians, economists and cultural experts around the world. This study has evaluated various effects of economic globalization on total labor demand broken into skilled and unskilled labor in Iran. In this study we use two models of ARDL and GMDH neural network and also two indexes of foreign direct investment and openness as indicators of globalization for investigating and forecasting the effects of globalization on the labor market. The study based on ARDL approach in the 1353-1385 period shows that globalization indexes have a positive impact on labor demand, but they do not have much impact on labor demand in the short run with this effect becoming increasingly significant in the long run. Also these impacts are greater on the demand of skilled labor than unskilled labor. Finally this study indicates that in all cases, GMDH neural network is a more efficient approach in forecasting employment impacts than ARDL.