Sectoral Growth and Job Creation: Evidence from Indonesia

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. Meanwhile, the agriculture sector growth still drives employment in rural areas, although it appears that the services sector also creates a significant number of jobs. Based on these findings, we provide some policy recommendations. 

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Author 
Asep Suryahadi
Sudarno Sumarto
Daniel Suryadarma
Author(s)
Daniel Suryadarma
Research Area 
National
Publication Type 
Journal Article