Effect of Education on the Workforce

Oct 13, 2025 by magicalceylontours.com 131 views

The Impact of Economic Forecasting Scenarios on the Workforce, Employment, Investment, Regional Minimum Wages, and Tertiary Sector Economic Growth in North Sumatra Province

Introduction

North Sumatra Province is a region with vast potential resources, encompassing the primary, secondary, and tertiary sectors. The development of these resources has the potential to increase provincial income through the tertiary sector. This study aims to examine the factors that influence the workforce, employment, investment, regional minimum wages, and income from the tertiary sector in North Sumatra Province. Furthermore, this study aims to predict the impact of economic policy on these components in North Sumatra Province from 2025 to 2030.

Background

The North Sumatra Province has been experiencing economic growth, but the pace of growth has been slow. The province's economy is heavily reliant on the primary sector, with agriculture and mining being the main contributors to the province's GDP. However, the tertiary sector has the potential to drive economic growth and increase provincial income. The development of the tertiary sector requires a well-educated workforce, a favorable business environment, and effective policies to encourage investment.

Methodology

This study uses a simultaneous equation model with time series data from 1997 to 2020. The estimated parameters are obtained using the 2SLS (Two Stage Least Squares) method, and data processing is carried out through the SAS/ETS computer program version 9.12. The model is used to forecast the impact of economic policy on the workforce, employment, investment, regional minimum wages, and tertiary sector growth in North Sumatra Province from 2025 to 2030.

Research Analysis and Findings

The results of this study show that the economic policies implemented in North Sumatra Province have not yet made a significant change to the workforce, employment, regional minimum wages, investment, and tertiary sector growth. However, there are several variables that have a real impact on these components.

Effect of Education on the Workforce

Educational variables have a significant effect (1%) on the workforce. This means that an increase in the level of education of the community will have a positive impact on the number of available workforce. A well-educated workforce is essential for the development of the tertiary sector, as it requires skilled and knowledgeable workers to drive economic growth.

Employment of Labor in the Trade Sector

Employment in the trade sub-sector shows a significant impact on all explanatory variables. This indicates that the trade sector plays an important role in absorbing labor in North Sumatra Province. The trade sector is a key driver of economic growth, and its development can create new jobs and stimulate economic activity.

Regional Minimum Wage

Regional Minimum Wage in North Sumatra Province affects real wages in the transportation and services subsector. The increase in the minimum wage can contribute to increasing the purchasing power and quality of life of the community. A higher minimum wage can also encourage investment and stimulate economic growth.

Good Investment

Good investment will create new jobs and encourage economic growth. Investment in the tertiary sector can drive economic growth and increase provincial income. A favorable business environment and effective policies to encourage investment are essential for the development of the tertiary sector.

Policy to Increase Investment Attractiveness

This policy is expected to increase investment attractiveness and trigger tertiary sector growth. A favorable business environment, effective policies to encourage investment, and a well-educated workforce are essential for the development of the tertiary sector.

Conclusion

Economic forecasting in North Sumatra Province gives an overview of the potential and challenges faced in the development of tertiary sectors. Although there are positive impacts from various variables, more directed and systematic policies are needed to encourage sustainable growth. Through increased investment, better wage policies, and focus on education, North Sumatra Province can maximize its economic potential and create broader jobs for the community. In the future, the results of this study can be a reference for local governments in formulating effective policies in improving the welfare of the community.

Recommendations

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

Increase investment in the tertiary sector: Investment in the tertiary sector can drive economic growth and increase provincial income.
Improve education and training: A well-educated workforce is essential for the development of the tertiary sector.
Implement effective policies to encourage investment: A favorable business environment and effective policies to encourage investment are essential for the development of the tertiary sector.
Increase the minimum wage: A higher minimum wage can contribute to increasing the purchasing power and quality of life of the community.
Develop a favorable business environment: A favorable business environment is essential for the development of the tertiary sector.

Limitations of the Study

This study has several limitations. Firstly, the study uses a simultaneous equation model with time series data from 1997 to 2020. This may not capture the current economic situation in North Sumatra Province. Secondly, the study assumes that the economic policies implemented in North Sumatra Province have not yet made a significant change to the workforce, employment, regional minimum wages, investment, and tertiary sector growth. This may not be the case in reality. Finally, the study does not consider the impact of external factors such as global economic trends and natural disasters on the economy of North Sumatra Province.

Future Research Directions

This study provides a foundation for future research on the impact of economic forecasting scenarios on the workforce, employment, investment, regional minimum wages, and tertiary sector economic growth in North Sumatra Province. Future research can build on this study by:

Using more recent data: Future research can use more recent data to capture the current economic situation in North Sumatra Province.
Considering external factors: Future research can consider the impact of external factors such as global economic trends and natural disasters on the economy of North Sumatra Province.
Developing a more comprehensive model: Future research can develop a more comprehensive model that includes more variables and interactions between variables.
Evaluating the effectiveness of economic policies: Future research can evaluate the effectiveness of economic policies in improving the welfare of the community in North Sumatra Province.

Conclusion

In conclusion, this study provides an overview of the potential and challenges faced in the development of tertiary sectors in North Sumatra Province. The study finds that educational variables have a significant effect on the workforce, employment in the trade sub-sector shows a significant impact on all explanatory variables, regional minimum wage affects real wages in the transportation and services subsector, good investment creates new jobs and encourages economic growth, and policy to increase investment attractiveness is expected to increase investment attractiveness and trigger tertiary sector growth. The study recommends increasing investment in the tertiary sector, improving education and training, implementing effective policies to encourage investment, increasing the minimum wage, and developing a favorable business environment. The study also highlights the limitations of the study and provides future research directions.
Frequently Asked Questions (FAQs) on the Impact of Economic Forecasting Scenarios on the Workforce, Employment, Investment, Regional Minimum Wages, and Tertiary Sector Economic Growth in North Sumatra Province

Q: What is the main objective of this study? A: The main objective of this study is to examine the factors that influence the workforce, employment, investment, regional minimum wages, and income from the tertiary sector in North Sumatra Province, and to predict the impact of economic policy on these components in North Sumatra Province from 2025 to 2030.

Q: What is the methodology used in this study? A: This study uses a simultaneous equation model with time series data from 1997 to 2020. The estimated parameters are obtained using the 2SLS (Two Stage Least Squares) method, and data processing is carried out through the SAS/ETS computer program version 9.12.

Q: What are the key findings of this study? A: The key findings of this study include:

Educational variables have a significant effect (1%) on the workforce.
Employment in the trade sub-sector shows a significant impact on all explanatory variables.
Regional Minimum Wage in North Sumatra Province affects real wages in the transportation and services subsector.
Good investment will create new jobs and encourage economic growth.
Policy to increase investment attractiveness is expected to increase investment attractiveness and trigger tertiary sector growth.

Q: What are the recommendations of this study? A: The recommendations of this study include:

Increase investment in the tertiary sector.
Improve education and training.
Implement effective policies to encourage investment.
Increase the minimum wage.
Develop a favorable business environment.

Q: What are the limitations of this study? A: The limitations of this study include:

The study uses a simultaneous equation model with time series data from 1997 to 2020, which may not capture the current economic situation in North Sumatra Province.
The study assumes that the economic policies implemented in North Sumatra Province have not yet made a significant change to the workforce, employment, regional minimum wages, investment, and tertiary sector growth.
The study does not consider the impact of external factors such as global economic trends and natural disasters on the economy of North Sumatra Province.

Q: What are the future research directions? A: The future research directions include:

Using more recent data to capture the current economic situation in North Sumatra Province.
Considering the impact of external factors such as global economic trends and natural disasters on the economy of North Sumatra Province.
Developing a more comprehensive model that includes more variables and interactions between variables.
Evaluating the effectiveness of economic policies in improving the welfare of the community in North Sumatra Province.

Q: What are the implications of this study for policymakers? A: The implications of this study for policymakers include:

The need to increase investment in the tertiary sector to drive economic growth and increase provincial income.
The need to improve education and training to develop a well-educated workforce.
The need to implement effective policies to encourage investment and develop a favorable business environment.
The need to increase the minimum wage to improve the purchasing power and quality of life of the community.

Q: What are the implications of this study for the community? A: The implications of this study for the community include:

The potential for increased economic growth and increased provincial income.
The potential for improved education and training opportunities.
The potential for increased investment and job creation.
The potential for improved purchasing power and quality of life.

Q: What are the implications of this study for the government? A: The implications of this study for the government include:

The need to develop and implement effective policies to encourage investment and drive economic growth.
The need to improve education and training to develop a well-educated workforce.
The need to increase the minimum wage to improve the purchasing power and quality of life of the community.
The need to develop a favorable business environment to attract investment and stimulate economic growth.