Analysis of the Influence of Education Level, Health Level, and Wage Level on Labor Force Participation (Labor Force Participation Rate) On the island of Madura

Elysa Sukma Libyanita; Marseto; Anisa Fitria Utami

doi:10.63922/ijebir.v4i04.1982

Elysa Sukma Libyanita Department of Development Economics, Faculty of Economics and Business, National Development University "Veteran" Java East
Marseto Department of Development Economics, Faculty of Economics and Business, National Development University "Veteran" Java East
Anisa Fitria Utami Department of Development Economics, Faculty of Economics and Business, National Development University "Veteran" Java East

DOI: https://doi.org/10.63922/ijebir.v4i04.1982

Keywords: Labor Force Participation Rate, Average School Length, Life Expectancy, Minimum Wage, Panel Data Regression, Madura Island.

Abstract

Economic development is an important part of national development with the main goal of achieving optimal growth. This study aims to analyze the influence of Average School Length (RLS), Life Expectancy (UHH), and Regency/City Minimum Wage (UMK) on the Labor Force Participation Rate (LABOR FORCE PARTICIPATION RATE) on Madura Island, which covers four districts in East Java during the period 2010–2024. This study uses secondary data obtained from the Central Statistics Agency (CSA), with a panel data regression analysis method. The results showed that the RLS variable had a positive but insignificant effect on LABOR FORCE PARTICIPATION RATE, indicating that education was not fully able to encourage work participation, possibly due to limited formal employment and skills mismatches. The UHH variable had a positive and significant effect, reflecting that improved health supports long-term work participation. Meanwhile, MSEs show a negative and significant influence on LABOR FORCE PARTICIPATION RATE, which can be caused by wage pressures in the informal sector. These findings imply that improving health quality is more effective in encouraging labor force participation than education and minimum wage policies in the region.

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