Our Expertise
Over the past few years, microbusinesses have been recognized as having an important role in improving the country's economy. Therefore, government institutions are expected to pay greater attention to microbusinesses.
To avoid the middle income trap, Indonesia needs to start shifting its economy to highervalue products, which requires a workforce that has an increasingly high level of knowledge, skills, and competencies. This implies that Indonesia needs to put more serious effort into the improvement of the quality of its education system.
We develop a growth-employment model that decomposes the Indonesian economy into six components, based on a combination of economic sectors and location, and ascertain the sectors that created the most jobs in Indonesia over the past two decades. We find that urban employment is mostly driven by higher growth in the services sector, especially areas that require skilled personnel.
Macro level data shows that Indonesia as well as Pekalongan City experienced an economic downturn due to the global financial crisis (GFC). Apart from this, however, there are also other local shocks which occurred in the city such as the closing of a factory due to internal mismanagement, batik’s competition shock, and the closing of the local fish trading place.
Poverty is one of humanity's greatest tragedies. Various efforts have already been made, but whatever strong efforts have been taken have not been able to overcome the problem of poverty or its impact due to the complexity of the underlying causes of poverty.
