Does Vocational Education Matter for the Labour Market? (A Case Study in Mining Sector in East Kalimantan – Indonesia)

Abstract

This study investigates the impact of education on labour market in mining sector at East Kalimantan by using the National Labour Force Survey (Sakernas) in 2010. By using multinomial logit method with three dependent variables consisting of formal labours of mining sector, informal mining sector, and non mining, this study figures out that education has significant effect especially for labour absorption in formal-mining sector. For high school level, vocational education has positive and significant effect toward labour absorption in formal mining sector. On the other hand, for higher education level, education has negative effect toward labour absorption in formal mining sector. In addition, the impact of education toward labour absorption in informal mining sector is insignificant.

Keywords: worker’s demography variable, economy (wage) variable, formal and informal mining sector, labour absorption, East Kalimantan.