Education and Economic Growth and the Role in Controlling Unemployment in Indonesia

English

Abstract

The purpose of this research is to find and analyse the relationship between education
and unemployment in Indonesia. This analysis makes use of World Bank information for
the years 1996-2020. The GDP, the unemployment rate, and the level of education are
used as independent variables. The VECM (Vector Error Correction Model) was used
for the testing. The findings indicate that a rise in educational attainment is inversely
related to the unemployment rate. Unemployment rates tend to fall as the economy
expands. The unemployment rate in Indonesia can be lowered if the country's education
system is strengthened. The Indonesian government, as a policymaker, must provide
educational opportunities for all citizens of the country. The policies for long-term
economic growth will benefit from this. As a result, this will serve to moderate and
ultimately lower Indonesia's high unemployment rate.