Inclusive and Sustainable Development Strategy

Oct 13, 2025 by talynt.org 129 views

Analysis of Factors that Influence Employment Opportunities in the City of Medan

Introduction

The availability of job opportunities is a crucial factor in determining the economic growth and development of a city. In the context of Medan, a city in North Sumatra, Indonesia, this study aims to identify the factors that influence employment opportunities from 1991 to 2021. The study focuses on three key variables: Gross Regional Domestic Product (GRDP), Regency/City Minimum Wage (UMK), and the number of labor force. By analyzing these variables, this study aims to provide valuable insights into the dynamics of employment opportunities in Medan and inform policy makers on how to create an inclusive and sustainable development strategy.

Methodology

This study uses a quantitative research approach, relying on documentation data in the form of time series data obtained from the Central Statistics Agency (BPS) of the Medan Office and the North Sumatra Provincial Manpower Office. The data collected includes GRDP, UMK, and the number of labor force from 1991 to 2021. The study uses multiple linear regression analysis as an analysis technique to examine the interaction between the three variables and their impact on employment opportunities.

Results

The analysis shows that partially, GRDP has an insignificant negative impact on employment opportunities, while UMK shows a significant negative effect. The number of labor force also recorded a negative effect that was not significant on employment opportunities in the city of Medan. However, simultaneously, GRDP, UMK, and the number of labor force had an influence on employment opportunities of 89.5%. This suggests that the three variables play an important role in determining the level of employment opportunities in Medan, while the remaining 10.5% is influenced by other variables that are not examined in this study.

Deeper Analysis

It is essential to understand why GRDP and the number of labor force can show negative effects on employment opportunities in Medan. GRDP, which should reflect economic growth, is not always accompanied by an increase in employment opportunities. This can be caused by several factors, such as inequality in investment distribution, where sectors that grow rapidly do not absorb a lot of labor. For example, capital-intensive technology and industrial sectors tend to replace workers with automation, so that even though GRDP increases, employment opportunities actually decrease.

On the other hand, high MSEs can create difficulties for entrepreneurs, especially Micro, Small and Medium Enterprises (MSMEs), in maintaining or increasing the number of workers. Although the UMK is designed to protect workers from low wages, if the UMK value is higher than the business ability to pay, this can cause a reduction in the number of employees, thereby increasing unemployment.

The high number of labor force also does not always have positive implications for employment opportunities. In this case, the high number of job seekers may be more caused by a mismatch between the skills of the workforce and the work market needs in Medan. In other words, irrelevant education and training can cause many individuals to be ready to work but cannot find the appropriate job.

Conclusion

This study provides valuable insights into the dynamics of employment opportunities in the city of Medan. Apart from the economic growth reflected in the GRDP and the existence of UMK regulations, the challenges remain in creating sufficient employment to accommodate the number of workforce that continues to increase. In-depth understanding of the factors that influence employment opportunities will be very important for policy makers in formulating an inclusive and sustainable development strategy. Further research is also recommended to explore other variables that may have an impact on employment opportunities that have not been identified in this study.

Recommendations

Based on the findings of this study, the following recommendations are made:

Inclusive and Sustainable Development Strategy: Policy makers should formulate an inclusive and sustainable development strategy that takes into account the factors that influence employment opportunities in Medan.
Investment in Education and Training: The government should invest in education and training programs that equip the workforce with relevant skills and knowledge to meet the needs of the labor market.
Support for MSMEs: The government should provide support to MSMEs, including access to finance, training, and marketing assistance, to help them maintain or increase the number of workers.
Review of UMK Regulations: The government should review the UMK regulations to ensure that they are not causing a reduction in the number of employees and increasing unemployment.
Further Research: Further research is recommended to explore other variables that may have an impact on employment opportunities that have not been identified in this study.

Limitations

This study has several limitations, including:

Data Limitations: The study relies on documentation data, which may not be comprehensive or accurate.
Methodological Limitations: The study uses multiple linear regression analysis, which may not capture the complexity of the relationships between the variables.
Sampling Limitations: The study uses a sample of data from 1991 to 2021, which may not be representative of the entire population.

Future Research Directions

Future research should aim to address the limitations of this study and explore other variables that may have an impact on employment opportunities in Medan. Some potential research directions include:

Exploring Other Variables: Future research should explore other variables that may have an impact on employment opportunities, such as government policies, labor market conditions, and demographic changes.
Using Alternative Methodologies: Future research should use alternative methodologies, such as qualitative research or machine learning algorithms, to capture the complexity of the relationships between the variables.
Using Larger Samples: Future research should use larger samples of data to increase the representativeness of the findings.
Q&A: Analysis of Factors that Influence Employment Opportunities in the City of Medan

Frequently Asked Questions

Q: What is the main objective of this study? A: The main objective of this study is to identify the factors that influence employment opportunities in the city of Medan from 1991 to 2021.

Q: What are the three key variables examined in this study? A: The three key variables examined in this study are Gross Regional Domestic Product (GRDP), Regency/City Minimum Wage (UMK), and the number of labor force.

Q: What is the significance of GRDP in this study? A: GRDP is significant in this study because it reflects economic growth, which is expected to increase employment opportunities. However, the analysis shows that GRDP has an insignificant negative impact on employment opportunities in Medan.

Q: What is the significance of UMK in this study? A: UMK is significant in this study because it is designed to protect workers from low wages. However, the analysis shows that UMK has a significant negative effect on employment opportunities in Medan.

Q: What is the significance of the number of labor force in this study? A: The number of labor force is significant in this study because it is expected to increase employment opportunities. However, the analysis shows that the number of labor force has a negative effect that was not significant on employment opportunities in Medan.

Q: What are the implications of the findings of this study? A: The findings of this study have implications for policy makers in formulating an inclusive and sustainable development strategy. The study suggests that the three variables examined in this study play an important role in determining the level of employment opportunities in Medan.

Q: What are the limitations of this study? A: The study has several limitations, including data limitations, methodological limitations, and sampling limitations.

Q: What are the recommendations of this study? A: The study recommends that policy makers formulate an inclusive and sustainable development strategy that takes into account the factors that influence employment opportunities in Medan. The study also recommends that the government invest in education and training programs, support MSMEs, review UMK regulations, and conduct further research.

Q: What are the future research directions of this study? A: The study suggests that future research should aim to address the limitations of this study and explore other variables that may have an impact on employment opportunities in Medan. Some potential research directions include exploring other variables, using alternative methodologies, and using larger samples of data.

Additional Questions and Answers

Q: What is the role of education and training in employment opportunities? A: Education and training play a crucial role in employment opportunities because they equip the workforce with relevant skills and knowledge to meet the needs of the labor market.

Q: How can MSMEs be supported to maintain or increase the number of workers? A: MSMEs can be supported by providing access to finance, training, and marketing assistance.

Q: What is the impact of UMK regulations on employment opportunities? A: UMK regulations can have a negative impact on employment opportunities if the UMK value is higher than the business ability to pay.

Q: What are the implications of the mismatch between the skills of the workforce and the work market needs in Medan? A: The mismatch between the skills of the workforce and the work market needs in Medan can lead to unemployment and underemployment.

Q: What are the future research directions in the field of employment opportunities? A: Future research directions in the field of employment opportunities include exploring other variables that may have an impact on employment opportunities, using alternative methodologies, and using larger samples of data.