Analysis of Factors That Influence Economic Growth and Its Impact on the Open Unemployment Rate. Districts in West Nusa Tenggara Province (NTB)

Abstract

This study aims to analyze the influence of the Labor Force Participation Rate (TPAK), financing of Micro, Small, and Medium Enterprises (MSMEs), Education Index, and Domestic Investment (PMDN) on Economic Growth and its impact on the Open Unemployment Rate (TPT). Districts in West Nusa Tenggara Province (NTB). This study uses a quantitative approach with panel data, combining cross-sectional data from 8 districts and time-series data for the period 2015–2024. The analysis method used is panel data regression with a fixed effects model processed using EViews. The results of the study indicate that simultaneously the variables TPAK, MSME financing, education index, and PMDN have a significant effect on economic growth with a coefficient of determination of 61.25%. Furthermore, economic growth has a negative and significant effect on the open unemployment rate with a probability value of 0.0304 (<0.05), which means that increasing economic growth tends to reduce the unemployment rate. However, there are still indications of jobless growth, where economic growth has not been fully followed by an increase in labor absorption. The implications of this research demonstrate the importance of promoting inclusive economic growth by improving the quality of the workforce, strengthening MSMEs, equalizing education, and more equitable distribution of investment in order to create jobs and improve public welfare.