WORKER TRANSITION ACROSS FORMAL AND INFORMAL SECTORS: A PANEL DATA ANALYSIS IN INDONESIA

Research output: Contribution to journalArticlepeer-review

2 Citations (Scopus)

Abstract

This paper examines the transition of workers between formal and informal jobs based on socio-demographic and employment characteristics. The study identifies factors that increase the likelihood of workers remaining in formal employment. The multinomial logistic regression model is incorporated to analyze labor transitions based on data from Indonesia's National Labor Force Survey (Sakernas) of 2017-2018. The findings show that 56.34% of workers were in informal activities and 30.58% were in formal jobs. Workers who transition from informal to formal jobs made up 6.84%, while 6.24% transitioned from formal to informal occupations. Informal workers were reluctant to move to the formal sector. Workers who are younger, unmarried, male, living in urban areas, and more educated are more likely to relocate from the informal to the formal sector. Work experience and participation in certified training can help shift workers to the formal sector, especially within the manufacturing industry.

Original languageEnglish
Pages (from-to)923-937
Number of pages15
JournalAsian Economic and Financial Review
Volume12
Issue number11
DOIs
Publication statusPublished - 2022

Keywords

  • Decent work
  • Entrepreneurship
  • Female entrepreneurship
  • Formal sector
  • Informal sector
  • Job creation
  • Labor market
  • Labor transition
  • Multinomial logistic regression
  • Professional learning

Fingerprint

Dive into the research topics of 'WORKER TRANSITION ACROSS FORMAL AND INFORMAL SECTORS: A PANEL DATA ANALYSIS IN INDONESIA'. Together they form a unique fingerprint.

Cite this