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ent at the level of US states. Co integration, causality analysis and granger test had been used to find out the long term relationship outcome and FDI variable, different test helps to indicate evidence of strong effect and employment growth.

The study of Nunnenkamp and Bremont (2007) analyzed the FDI effect on the employment in Mexico. By using GMM estimation study also explored the blue and white collar jobs in the 200 manufacturing countries of Mexico. From 1994 to 2006 in Mexico the FDI had a significantly positive effect on the employment level. Moreover, the study found that the white collar jobs were not significantly improved as compare to blue collar jobs. The positive effect on the blue collar jobs were diminishing with the increasing skill intensity of manufacturing industries.

The study of Blonigen and slaughter (1999) tested by using regression analysis to find out whether inward FDI contributed to the shift the demand of the more skilled labor employment in the US. The study indicated that there is no contribution to the skilled upgrading in the US job market from the inward FDI. The study also indicated that in 1980 Greenfield investment from Japan to US only carried a positive demand for the skilled labor. The studies also indicate that the inward FDI brought new technology in the US, the induced technological change is not biased towards skilled labor.

The study of Blonigen and Slaughter (2001) investigated the foreign affiliation activity and US skill upgrading. The study also found that the foreign affiliation firm grown more rapidly as compare to the domestic firms. Using 1977 to 1994 data study found that inward FDI contributed nothing to the skill upgrading employment. Study generally suggest no relationship between foreign-affiliate activity and U.S. skill upgrading, the strong inverse relationship study finds for the particular case of Japanese-greenfield investments may have relevance for MNE theory and may also suggest future research avenues.

In Pakistan the employment is motivated by the investment and particularly foreign investment in the country. The determinant of the foreign investment is any host countries is mainly motivated by the wages rate and the tariff of the country. This study of Bognanno, Keane, and Yang (2005) by using the data of US direct investment survey examines the operations of US Multinational Corporation in seven industries of twenty two countries. This study analyzed wages, tariffs and industrial relations environments influence US Multination Corporation. The study results shows statistically that wages and the industrial relations environment were of the extent to which MNCs located operations in a particular host country.

In Pakistan the biggest dilemma of employment is that Pakistan is more emphasize on the foreign investment rather than increasing manufacturing export and reducing manufacturing imports. The studies of Napoles (2004) by using the data from 1978 to 2000 of Mexico analyze exports, growth, and employment. From 1978 to 2000 Mexico is on the export led growth strategy accompanied by trade liberalization. These studies analyze the export and the employment relationship. The study concluded that the export can reduce employment as well as manufacturing exports also reduce the manufacturing imports.

The environmental stability in the economy is on the based principle of the functio