Relevance of Investment, Economic Growth and Labor Force in Indonesia (An Empirical Analysis)

Wiwin Anggriani Salawali (), Nursini Nursini, Sri Undai Nurbayani and Retno Fitrianti
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Wiwin Anggriani Salawali: Hasanuddin University, Economics Doctoral Program Student, Postgraduate Faculty of Economics and Business
Nursini Nursini: Hasanuddin University, Faculty of Economics and Business
Sri Undai Nurbayani: Hasanuddin University, Faculty of Economics and Business
Retno Fitrianti: Hasanuddin University, Faculty of Economics and Business

A chapter in Proceedings of the 9th International Conference on Accounting, Management, and Economics 2024 (ICAME 2024), 2025, pp 306-318 from Springer

Abstract: Abstract The role of investment critical driving economic growth, which in turn creates jobs for the labor force. The interconnectedness of investment, economic growth and labor force forms the basis of economic prosperity, as investment drives productivity and innovation, economic growth creates wealth, and a healthy labor force ensures the sustainability of development. This study aims to look at the effect of domestic investment and foreign investment in the primary, secondary, and tertiary sectors on economic growth and the labor force in Indonesia. The research period is thirteen years, from 2011 to 2023. The model used multiple regression equations. The results showed that domestic investment in the primary and secondary sectors had an influence on economic growth and for foreign investment in all three sectors had a significant effect on economic growth even though the secondary and tertiary sectors had a negative impact. Furthermore, domestic investment in the secondary sector has an influence on the labor force and foreign investment in the secondary and tertiary sectors is significant to the labor force. The increase in the Indonesian economy is strongly influenced by foreign investment when compared to domestic investment, and therefore the country needs to take some strategic steps to encourage the growth of domestic investment while maintaining healthy foreign investment flows.

Keywords: Domestic investment; foreign investment; Economic Growth; Labor Force; Indonesia (search for similar items in EconPapers)
Date: 2025
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DOI: 10.2991/978-94-6463-758-8_26

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