Leading Sector And Employment Opportunities in Denpasar City
15/06/2020 Views : 308
I Gusti Bagus Indrajaya
LEADING SECTORS AND
EMPLOYMENT OPPORTUNITIES IN DENPASAR CITY
I Gusti Bagus
Indrajaya
e-mail:
indrajaya@unud.ac.id
Introduction
Development is an effort carried
out continuously by a nation to achieve better community welfare. Development
can be seen from the economic growth and progress of the social conditions of
the people. Noting this reality, many developing countries have turned their
attention to development strategies that lead to development policies to
provide employment opportunities that are able to absorb the majority of the
workforce. While the development objectives are (1) increasing the availability
and expansion of the distribution of staple goods. The goods in the form of
clothing, food and shelter needs as well as other supporting needs such as
health, education to security, (2) improvement of living standards, this goal
does not only include increasing income but also must include employment
opportunities, improving the quality of education and community life both
materially and fostering the identity contained in each nation, (3) expansion
of economic and social choices for each individual, which includes the
liberation of society from the nature of servitude to someone as well as to
everything that might degrade the life of the community.
Economic growth which has been
indicated as a successful development performance has not been able to reduce
unemployment. Efforts to overcome development problems, especially employment
issues, are actually not new. Developing countries with high levels of economic
growth apparently have not had a significant influence on the welfare of the
people, even a decline in the level of real life. Unemployment and false
unemployment rates have increased in rural and urban areas, inequality in
income distribution between the rich and the poor, and regional inequality has
given rise to widening inequality (Yustika, 2004: 23). To achieve these
objectives, various allocations of development resources namely natural
resources, human resources, capital and technology have been utilized to the
fullest but the results achieved are still causing gaps, both between regions,
between regions, between sectors, between groups, and between cities and
villages. The implementation of development so far, even though it has shown
positive results, is still widely felt by the inefficiency of the allocation of
economic resources.
The role of the
government
In overcoming problems related to
regional development, many Western economists argue that government
intervention in regional development planning must be done more broadly.
Several reasons have been put forward to prove the importance of broad
government interference in regional development. Among others, to prevent the
adverse effects of market mechanisms on development in various regions and to
ensure that the development created can be enjoyed by various regions.
Government intervention is very important in creating development in developing
countries. Among economists and other social scientists have long been aware of
the inability of market mechanisms to create rapid development in developing
countries. Therefore, broad government intervention is necessary if these goals
are to be achieved by each developing country. It has also been realized that
government intervention will achieve maximum results if there is effective
coordination of various businesses, and for this purpose development planning
needs to be carried out. According to Lincolin Arsyad (1999), there are 4
(four) roles that can be taken by local governments in the regional economic
development process, namely; (1) entrepreneur, the local government is
responsible for running a business. Local governments can develop their own
businesses in the form of Regionally Owned Enterprises (BUMD). Regional
government assets can be better managed so that it is economically profitable,
(2) coordinators, local governments can act as coordinators to set policies or
propose strategies for development in their regions. In their role as
coordinators, local governments can also involve other government institutions,
the business community, and the community in the formulation of economic goals,
plans, and strategies, (3) facilitators, local government can accelerate
development through improving the attitudinal environment (community behavior
or culture) in the area. This will speed up the development process and better
planning procedures and zooning arrangements, (4) stimulators, local
governments can stimulate creation and use
Leading sector
Leading sectors are quantitative
techniques using location quotient analysis (LQ) to determine the export
capacity of the regional economy and the degree of independence of an economic
sector (Tri Widodo, 2006). In the LQ analysis, the economic activities of a
region are divided into 2 (two) types, namely; (1) sector activities that serve
markets in the region itself or outside the area concerned are called leading
sectors (base industries), (2) sector activities that serve markets in these
regions, this type is called non-leading sectors (local industries). Leading
sectors produce goods and services that can be sold outside the region and in a
chain will increase consumption and ultimately will increase investment which
means creating new jobs. The increase in regional income besides increasing
demand for the superior sector results also increases demand for the
non-leading sector. Leading sectors need to be developed in order to spur
economic growth in a region which in the end regional income will immediately
increase if the leading sector has expanded, while the increase in new
employment opportunities will be felt in the long run.
Emperical data
Denpasar City is one of the
second-tier regions in Bali Province with a population of 897,300 people in the
middle of 2016 or 21.36 percent of the total population in Bali Province which
makes Denpasar as the most populous and most populous area in Bali, Denpasar
City has its own challenges in mitigating the unemployment rate. One of the
causes of the high unemployment rate in Denpasar City is the high influx of
migrants due to the attractiveness of Denpasar City as the capital of the
province encouraging residents of other regions to stay either to find work or
for other purposes such as to get better education. The high flow of migrants
certainly brings very complex problems. Economic competitiveness is quite high
and the arrival of migrants who are often not accompanied by sufficient
expertise will actually lead to new problems for the economy of Denpasar City.
Therefore, although with a GRDP contribution of 18.86 percent of the total GRDP
of Bali Province, the high number and population growth makes it a special task
for the City of Denpasar to continue to improve its welfare as indicated by an
increase in GDP per capita through a strategy by relocating the development
budget of the economic sector non superior to leading economic sectors. The
results of the constant GDP price data processed in 2010 during the 2013-2017
research year showed that 53 percent of the economic sector of Denpasar City
was in the prime economic sector group, namely the economic sector with greater
growth and contribution compared to the same economic sector in the Province of
Bali, 35 percent the economic sector is in the developing and potential group,
and 12 percent of the economic sector in Denpasar City is in the backward group
with slow growth and a small contribution to the GRDP. The prime economic
sector consists of electricity and gas procurement, water supply, waste
management, waste and recycling, construction, wholesale and retail trade, car
and motorcycle repair, financial and insurance services, real estate, company
services, education services, and health services and social activities.
To obtain the leading economic
sector which is shown by the LQ value of the largest among other prime economic
sectors, the constant price GRDP data processing in 2010 for the period
2013-2017 was conducted. The results of the processed data show that the
economic sector of electricity and gas procurement as well as the economic sector
of education services during the observation year are the leading economic
sectors. Increasing economic value added in each economic sector can create
jobs through several leading sectors. The analysis shows that the partial value
of the leading economic sectors of education services has a positive and
significant effect on employment in Denpasar City. The regression coefficient
of the leading economic services sector of education by 0.837 states that every
increase of one LQ value assuming the leading economic sector of electricity
and gas procurement is constant or constant, the employment rate in Denpasar
City increases by 83.7 percent. Denpasar City Government in an effort to expand
employment opportunities should be able to synergize leading economic sectors
with economic sectors that have not been superior by providing fiscal stimulus
to investors who will establish businesses in economic sectors that are not yet
superior.