Analysis of the Influence of Economic and Educational Factors on the Unemployment Rate in Indonesia
DOI:
https://doi.org/10.61536/escalate.v1i02.463Keywords:
unemployment, economic factors, education, labor force, literature reviewAbstract
This study aims to analyze the factors influencing the unemployment rate in Indonesia, particularly from economic and educational perspectives. The research employs a literature review method by examining relevant journals, books, and data from Statistics Indonesia. The findings indicate that economic factors such as economic growth, inflation, and minimum wages significantly affect the unemployment rate. Meanwhile, educational factors, including education level, skills, and the alignment between competencies and labor market demands, also play a crucial role in workforce absorption. However, the mismatch between education and industry needs, along with the lack of soft skills, remains a major cause of educated unemployment. Therefore, strong collaboration among the government, educational institutions, and industry is necessary to develop a competent workforce aligned with labor market demands.
Downloads
References
Adam, L., & Negara, S. D. (2015). Improving human capital through better education to support Indonesia’s economic development. Economics and Finance in Indonesia, 61(2), 95–108.
Adely, F. I. J., Mitra, A., Mohamed, M., & Shaham, A. (2021). Poor education, unemployment and the promise of skills: The hegemony of the “skills mismatch” discourse. International Journal of Educational Development, 82, 102381.
Akbar, M., et al. (2022). The impact of unemployment on poverty and social inequality in Indonesia. Journal of Social and Economic Development, 5(1), 23–35.
Anggraini, D., et al. (2024). Analysis of factors influencing unemployment in Indonesia: A review of soft skills and graduate competencies. Journal of Economics and Education, 12(1), 45–58.
Bharoto, R. M. H. (2024). The impact of high job qualification standards on unemployment rates among fresh graduates in Indonesia. Journal of Technology Update Studies, 2(4), 1–12.
Badan Pusat Statistik (BPS). (2023). Keadaan ketenagakerjaan Indonesia Agustus 2023. Jakarta: BPS.
Borjas, G. J. (2016). Labor economics (7th ed.). New York: McGraw-Hill Education.
Díaz Pavéz, L., et al. (2024). The impact of automation on labour market outcomes in emerging countries. The World Economy, 47(2), 342–370. https://doi.org/10.1111/twec.13523
Diniyah, N., & Fisabilillah, L. (2022). The effect of gross domestic product and human development index on open unemployment rate in Indonesia. Journal of Macroeconomic Studies, 8(2), 112–125.
Frisnoiry, S., et al. (2024). Challenges of vocational education and industry relevance in reducing structural unemployment. Journal of Technology and Vocational Education, 15(3), 201–215.
Hussein, A. (2024). Soft skills and career transitions: Postgraduate employability in the digital age. International Journal of Career Development, 18(2), 44–60.
International Labour Organization. (2022). World employment and social outlook: Trends 2022. Geneva: International Labour Organization.
Khoiruddin, M. A., Setyanti, A. M., Suman, A., Prasetyia, F. (2024). Exploring determinants of education-job mismatch among educated workers in Indonesia. Jurnal Ekonomi Pembangunan: Kajian Masalah Ekonomi dan Pembangunan, 25(2), 263–281. https://doi.org/10.23917/jep.v25i2.8483
Murni, A. (2016). Macroeconomics. Bandung: Refika Aditama.
Mustika, C. (2010). The effect of regional minimum wage on unemployment rate in Indonesia. Journal of Economic Perspectives and Regional Development, 2(1), 15–28.
Oxford Business Group. (2024). Indonesia’s human capital initiatives: Jobs, education and upskilling. Oxford: Oxford Business Group.
Peersia, A. (2024). Integrating soft skills in Indonesian higher education: Curriculum challenges and policy implications. Journal of Indonesian Education Policy, 7(1), 12–26.
Ramadhina, A., et al. (2025). Skills mismatch and educated unemployment: A case study of higher education graduates absorption in Indonesia. Journal of Management and Business Research, 10(1), 33–47.
Rizal, M., et al. (2020). Unemployment, poverty and income inequality in Indonesia: A review. Economic Review: Journal of Economics and Business, 18(1), 67–78.
Setiawati, N., & Wijayanti, R. (2022). Soft skills as predictors of work readiness among non-STEM graduates in Indonesia. Indonesian Journal of Educational Research, 11(2), 155–168.
Suryono, I. L., Gunawan, B. T., Hennigusnia, & Kurniawati, A. (2026). Employment mismatch trends in the digitalization age: Indonesia case studies. In Nawawi et al. (Eds.), Managing Disruption and Developing Resilience for a Better Southeast Asia. SEASIA 2022. Springer Proceedings in Humanities and Social Sciences. https://doi.org/10.1007/978-981-96-2116-3_15
Syarifudin, S., et al. (2024). Graduate unemployment hinders economic growth in Indonesia: Does government spending on education matter? International Journal of Economics and Financial Issues, 14(3), 1–10.
Todaro, M. P., & Smith, S. C. (2015). Economic development (12th ed.). Boston: Pearson Education.
Widarni, E. L., & Bawono, S. (2023). Investigating the role of education in stability of work participation in economic shocks from the Asian financial crisis to the COVID-19 pandemic in Indonesia. International Journal of Professional Business Review, 8(1), e0811. https://doi.org/10.26668/businessreview/2023.v8i1.811
Wicaksono, P., Theresia, I., & Al Aufa, B. (2023). Education–occupation mismatch and its wage penalties: Evidence from Indonesia. Cogent Business & Management, 10(3), 2251206. https://doi.org/10.1080/23311975.2023.2251206
Wihardja, M. M., et al. (2023). Digital transformation in Indonesia’s labour market. ISEAS Perspective, 2024(6). ISEAS–Yusof Ishak Institute.
World Bank. (2023). World development report 2023: Jobs and economic transformation. Washington, DC: World Bank.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2024 Ayu Gracia Febrianti Hutapea, Christy Alicyanova Simatupang, Tamariska Tumanggor
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
