New Insights into Colombia’s Urban Vacancies–Unemployment Nexus: Estimation Using Equilibrium and Long-Term Unemployment

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This study evaluates the relationship between labor demand and unemployment in Colombia for January 2011 to January 2022. The research follows a structured and quantitative approach, adopting an explanatory and longitudinal perspective. A detailed analysis of sectors with high labor demand is conducted, and key indicators such as the job vacancy rate, the Non-Accelerating Inflation Rate of Unemployment (NAIRU), and the Long-Term Unemployment Persistence Rate (LAPU) are calculated based on a solid theoretical foundation. Using graphical analysis and Vector Autoregressive (VAR) models, a non-linear relationship between the job vacancy rate and the NAIRU is identified. It is observed that an increase in the persistence of unemployment duration leads to a rise in the job vacancy rate (JVR), indicating structural inequality in the labor market. Variance decomposition analysis and impulse response functions confirm that both the NAIRU and the LAPU have a significant impact on the variability of the job vacancy rate. These findings suggest that the JVR is influenced by both structural and frictional factors in the labor market, although it primarily responds to fluctuations in the economic cycle, which are best identified through the Unemployment Gap.