When Does Growth Create Jobs? Business-Cycle Asymmetry and Demographic Capacity in ASEAN-5

A high rate of output growth is often treated as sufficient evidence that an economy is generating employment, yet the employment content of growth varies across countries, institutional settings, and cyclical conditions. This study examines when growth is associated with employment absorption in ASEAN-5 Indonesia, Malaysia, the Philippines, Thailand, and Viet Nam over 2010–2023. Employment absorption is measured by the employment-to-population ratio for persons aged 15 years and above, a more direct indicator of labour utilisation than the unemployment rate where participation margins are elastic. The specification relates the ratio to its own lag, real GDP growth, demographic capacity defined as one hundred minus the age dependency ratio, the Human Development Index, a business-cycle regime indicator derived from the output gap, and an interaction between growth and that indicator, conditioning on macroeconomic controls and country and year effects. Estimation uses a bias-corrected least-squares dummy-variable estimator with bootstrap inference. Employment absorption is strongly persistent and dynamically stable. Growth is positively associated with the employment-to-population ratio under slack conditions, and the implied boom-period association is also positive and significant. The two regime-specific associations differ numerically, but the interaction term that formally tests this difference is statistically insignificant, so business-cycle asymmetry in the growth–employment slope is not established. Demographic capacity receives qualified support and human development is statistically insignificant. Growth therefore accompanies labour absorption across cyclical states from a heavily inherited employment base, indicating that growth strategies warrant evaluation by their employment content rather than output expansion alone. All estimates are dynamic conditional associations rather than identified causal effects.