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Abstract:
This study analyzed the determinants of unemployment in Special Province Yogyakarta (DIY), partially and simultaneously using panel data regression analysis with data from five regencies/city in DIY from 2010 to 2015.
The results indicate that the wage partially has negative and significant impact to unemployment but population variables partially has positive and significant impact to unemployment of regencies/ city in DIY. Variables of education and economic growth partially do not have positive and significant effects for unemployment (UNEM) in DIY.
Meanwhile simultaneously the variables Education (EDU), Wage (WG), Population (POP) and Economic Growth (EG) have a significant effect on the unemployment in DIY.
Keywords: Unemployment, Education, Wage, Population, Economic Growth.
JEL code: J64.
1.Introduction
Unemployment become one of concerning issues in economic studies. In view of Ordine and Rose (2015) who investigate about years of study of labors, prospective labors who have longer years of study (educational mismatch or overeducation) are having the highest possibility to become unemployed rather than those who graduate on time. The cause is supplier in labor market prefer to select candidates who graduated on time. Unemployment becomes burden in the development of DIY province which has four regencies (Gunungkidul, Kulonprogo, Sleman, and Bantul) and one city, Yogyakarta. Each regency and city have a different number of unemployment and the change rate as a result of their own development progress. Labor forces who unemployed are burdening regional development due to their incapability to contribute in economy development by producing output to the economy while they consume and request for public services.
The growth of unemployment in DIY during 2010-2015 are categorized into two. First, regencies/city which had decreasing growth of unemployment. Those are Kulonprogo regency and Yogyakarta city. Both showed the success of government's policy implementation in reducing number of unemployment. In 2010, the number of unemployment in Kulonprogo regency was 9,202. It decreased to 6,698 in 2013 then shrinking to 8,966 in 2015. On the other hand, Yogyakarta city had 14,067 unemployments in 2010 which decreased to 13,510 in 2013. In 2015, this number declined to 12,277 people. Second category is regencies which had increasing growth of unemployment. Bantul, Gunung Kidul, and Sleman regency are part of it. In 2010, Bantul regency had number of 13,780 unemployment which...