Elisa Clara Saragih
State University of Medan

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The Effect of the Labor Force Participation Rate (LFPR) and Population on Economic Growth in North Sumatra Era Widia Br Sinaga; Annisah Saajidah; Elisa Clara Saragih; Melani Manginar Sirait; Relli Anisma Hutabalian; Nasrullah Hidayat
Jurnal Ekonomi Balance Vol. 21 No. 2 (2025): December 2025
Publisher : Perpustakaan dan Penerbitan Unismuh Makassar

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.26618/1s7b6q30

Abstract

This study investigates the effect of the Labor Force Participation Rate (LFPR) and population size on economic growth in North Sumatra Province during the 2018–2023 period. Economic growth remains a crucial indicator of regional development performance, particularly in provinces experiencing demographic dynamics and labor market fluctuations. Using a quantitative approach, this study employs multiple linear regression analysis based on secondary data obtained from the Central Bureau of Statistics (BPS) and the North Sumatra Manpower Office. Prior to estimation, classical assumption tests including normality, multicollinearity, autocorrelation, and heteroscedasticity were conducted to ensure model robustness. The empirical results reveal that LFPR has a positive and statistically significant effect on economic growth, indicating that higher labor market participation enhances regional production capacity and output. Population size also shows a positive and significant influence, suggesting that population growth can stimulate economic activity through expanded labor supply and consumption demand when properly managed. Simultaneously, LFPR and population significantly affect economic growth, as confirmed by the F-test results. The coefficient of determination (R²) of 91.84% indicates that the two independent variables explain a substantial proportion of variations in economic growth in North Sumatra. These findings highlight the strategic role of labor force engagement and demographic management in fostering sustainable regional economic growth. Policy implications emphasize the importance of job creation, workforce skill development, and human capital investment to maximize the benefits of demographic potential and support inclusive economic development in North Sumatra Province.
Determinants of Open Unemployment in Indonesia: The Role of Average Length of Schooling, Minimum Wage, and Economic Growth M. Deni Damara; Kautsar Fatin Dharmawan Nasution; Bunga Ananda; Cindy Eleonora Sitohang; Era Widia Br. Sinaga; Elisa Clara Saragih; Melani Manginar Sirait; Relli Anisma Hutabalian; Noni Rozaini
Jurnal Ekonomi Balance Vol. 22 No. 1 (2026): June 2026
Publisher : Perpustakaan dan Penerbitan Unismuh Makassar

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.26618/6qa5mk92

Abstract

Open unemployment remains one of the most persistent socioeconomic challenges in Indonesia, despite continuous improvements in macroeconomic performance and labor market policies. This study investigates the effects of Average Length of Schooling (ALS), Minimum Wage (MW), and Economic Growth (EG) on the Open Unemployment Rate (OUR) in Indonesia over the 2015–2024 period. A descriptive-verificative quantitative approach was employed using annual secondary data obtained from Statistics Indonesia (BPS). The data were analyzed using multiple linear regression with EViews software. Prior to hypothesis testing, the model was evaluated through classical assumption tests, while the significance of the relationships was assessed using the t-test, F-test, and coefficient of determination (R²). The empirical findings indicate that, individually, Average Length of Schooling and Minimum Wage do not have a statistically significant effect on the Open Unemployment Rate. In contrast, Economic Growth has a significant negative effect, indicating that higher economic growth contributes to lower unemployment levels by expanding employment opportunities and stimulating productive economic activities. Simultaneously, the three independent variables significantly influence the Open Unemployment Rate, with an R² value of 0.82, suggesting that the model explains approximately 82% of the variation in unemployment during the study period. These findings emphasize that sustainable economic growth remains the primary driver of employment creation, whereas education and wage policies require stronger alignment with labor market demands. The study provides empirical evidence for policymakers to formulate integrated, inclusive, and sustainable employment strategies that enhance workforce competitiveness and support long-term economic development.