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Vol. 22 No. 1 (2024): Jurnal Ekonomi Pembangunan
Submitted
May 6, 2024
Accepted
June 28, 2024
Published
June 30, 2024
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Abstract

Poverty alleviation is an important priority for governments. Encouraging manufacturing growth is often seen as an effective strategy to alleviate poverty. However, the impact of such growth on poverty rates in Sumatra Island remains unclear. This study analyze the impact of manufacturing growth on poverty rates in 10 provinces in Sumatra Island, using secondary data from 2008 to 2022. Using the quantitative approach and panel data regression analysis, the results show that industrial growth in Sumatra Island, although not significant, has an impact on poverty reduction. However, industrial growth can indirectly absorb labor. Labor and education variables have a negative and significant effect on poverty.  These findings highlight the need for policy interventions focusing on vocational education and training, infrastructure improvement, economic diversification, labor policies, and local community empowerment to effectively reduce poverty.

Keywords

manufacturing industry poverty income labor education

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Author Biographies

Mukhlis, Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

Suhel, Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

Yunita Aulia, Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

Putri Indah Lestari, Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

Hamira, Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

Department of Development Economics, Faculty of Economics, Universitas Sriwijaya, Indonesia

How to Cite
Mukhlis, D., Suhel, D., Aulia, Y., Indah Lestari, P., & Hamira. (2024). Does the Manufacturing Industry Reduce Poverty on Sumatra Island?. Jurnal Ekonomi Pembangunan, 22(1), 121–132. https://doi.org/10.29259/jep.v22i1.23124
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