Unemployment in Indonesia Essay

4575 WordsJun 12, 201219 Pages
I. Introduction A. Backgrounds As developing country, Indonesia faces the big problematic issues in economic. One of the issues is unemployment. Developing countries have extreme difference between the big number of the poor and the little number of the rich. Number of the poor people who are not working and number of the non poor who are low educated and unemployed might tend to become discouraged workers. Most unemployment is caused by people who have no work and are actively looking for the job. In developing countries, unemployed does not always come from poor families. Furthermore, it is also possible that they are relatively highly educated, thus have high wage reservations and prefer to wait for the high paying job. Also, there are part time workers who want full time jobs. In addition, there is always natural employment which arises from job search activity in a country. It is important to provide the job which is match the skills and expectation of unemployed in the country. For example, an employment creation program which provide below market wages would not attract highly educated unemployed to work. In other hand, the program would attract those who are already working in the informal sector to switch jobs or discouraged workers to enter the labor market. As the result, while it may be successful in increasing general welfare, the program would not reduce the unemployment rate. We need to know how we strengthen economic growth to create employment opportunities. Therefore, it is important assessing the growth elasticity of employment in every sector, which measures the ability of each percent of economic growth, to increase employment and to match the job offers with the skills of unemployed. B. Objectives 1. Analyzing unemployment rate in rural and urban area Indonesia. 2. Knowing the characteristic of unemployment in Indonesia
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