1. Domestic Investment or Domestic Investment
(PMDN).
According to Regulation Number 27 of 2007
concerning Investment, what is meant by domestic
capital is part of the wealth of the people of
Indonesia, including rights and objects, both state-
owned and national or private, which are domiciled
in Indonesia, which set aside / provided to run a
business.
2. Foreign Investment or Foreign Investment
(PMA)
Foreign investment is capital owned by a
foreign country, an individual from a foreign
country, a foreign business entity, a foreign legal
entity, and / or an Indonesian legal entity which is
partly or wholly owned by a foreign party. Foreign
investment is an investment activity to do business
in the territory of the Republic of Indonesia carried
out by foreign investors, both those who use foreign
capital fully and share with domestic investors.
2.2 Previous Research
(Chusna, 2013) reviewing the influence of the
growth rate of the industrial sector, investment, and
wages on the absorption of industrial sector labor in
the Central Java province in 1980-2011. This study
was analyzed using multiple linear regression
analysis. The conclusion of this study shows that
industrial sector growth shows a declining trend
while investment, wages and labor absorption in the
industrial sector shows an increasing trend, the
growth rate of the industrial sector does not affect
the absorption of industrial sector employment,
while investment and wages affect absorption
industrial sector workforce in Central Java.
(Darman, 2013) examines the effect of economic
growth on the unemployment rate: Okun's Legal
analysis. This study uses time series data from 1990-
2013. The method used is the difference version of
Okun's law Okun gain coefficient and analysis of
ordinary least squares (OLS) to obtain regression
coefficients. The results of the study indicate that
Okun's law applies in Indonesia, where the Okun
coefficient is negative. The unemployment rate tends
to increase along with the achievement of GDP
growth.
(Dimas and Woyanti, 2009), conducted research
on employment absorption in DKI Jakarta in 1990-
2004. The analysis technique used is multiple linear
regression. The results indicate that GDP growth had
a positive effect on employment in Jakarta, while the
variable wage and investment negatively affect
employment. These negative effects caused by a
more focused investment coming to the capital-
intensive business than labor-intensive, so that
investment does not increase employment.
(Sobita and Suparta, 2014) conducted research
on economic growth and employment in Lampung.
the period 2008-2012. The data analysis method
used is quantitative data analysis (statistics) using
panel data analysis. These results indicate that the
independent variable and the real GRDP Capital
prices in agriculture significantly positive effect on
employment. The increase in real GDP and capital in
agriculture will increase employment. Meanwhile
the real wage variable significantly has a negative
effect on employment. Increase in real wages will
reduce employment.
(Sulistiawati, 2012) conducted a study on the
effect of minimum wages on employment and social
welfare in the province in Indonesia 2006-2010. The
analytical method used is the path analysis model.
These results indicate that the minimum wage
increase will reduce the use of labor with low
productivity that is generally absorbed in the
primary sector, the sector that absorbs most of the
manpower. Second, the absorption of labor has a
positive but not significant effect on social welfare.
The influence of employment on social welfare has
path coefficient of 0.08 with a significance
probability value (Sig) of 0.332. The results of this
study showed that the increase in employment did
not cause an increase in social welfare in the
provinces in Indonesia because: (1). The minimum
wages received by workers is lower than the
minimum basic needs, (2) the minimum wage
earned by a lower level of tax revenue.
(Mahalli, 2008) examining employment
opportunities and economic growth in the city of
Medan. The analysis tool used is the elasticity
calculation formula. Using the concept of elasticity
found the results of that labor elasticity coefficient
of 0.207% (Inelastic), means that for every 1% of
economic growth led to employment opportunities
open to 0.207%. While the most sensitive sectors for
employment in financial services with employment
elasticity coefficient of 1,023% (elastic). On the
demand side, the average education level of workers
is occupied by Diploma III (40.67%). Followed by
postgraduate level of 30.67% and secondary school
(25.33%) until 2010
(Arida, Zakiah and Julaini, 2015) conducted
research on the analysis of labor demand and supply
in the agricultural sector in Aceh Province. Analysis
of the data used in this study using an econometric
model with multiple single equation is the method of
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