This study examined the macroeconomic determinants of unemployment in Ethiopia over arnperiod of 1978 to 2018 by investigating the empirical relationship between unemployment (UN),rnreal gross domestic product (RGDP), net foreign direct investment (NFDI), external debt (ED),rnreal exchange rate (RER), inflation rate (INFR) and Proclamation that encourage privaternemployment agencies as dummy variable (DM_LM) using Autoregressive Distributed Lag Modelrnand Error Correction model (ECM). The result reveals that RGDP,NFDI and INFR) affectrnunemployment negatively in the short run while ED and RER have positive relation withrnunemployment and statistically significant at 5% level in the short run. However, in the long run,rnonly RGDP and RER are negatively related with unemployment and statistically significant. Therneffect of economic growth is higher than other determinants in short run and long run. The ECMrnequilibrates the short run dynamics to the long run dynamics by the speed of 19.93%. Thernrelationship between unemployment and inflation rate is negative in the short run and positive in the longrnrun which implies Phillips curve exists only in the short run. It is recommended that policies andrnstrategies focusing on increasing economic growth focusing on agriculture, improving tradernbalance through devaluing domestic currency relative to foreign currency, enhancing infantrndomestic industries instead of attracting FDI, reduce external loan, control inflationary problem,rninvesting in modernizing labour market service provision are crucial and that governmentrnshould give due attention to reduce unemployment in Ethiopia.