Indonesia's Higher Education System : How Responsive is it to the Labor Market?

Indonesia is at a development crossroads. It successfully weathered the 2008 international financial crisis, and it has shown resilience in the current turbulent times. Its economy is now one of the largest 20 economies in the world and it has ambitious plans to achieve high-income status and join the G-7 by 2030. Yet the challenges it faces are daunting. As highlighted in the recent Indonesia Economic Quarterly report by the World Bank, the status quo may not be enough to maintain current growth rates in light of domestic and policy pressures. And even maintaining the current rates of growth will not bring the country to high income status by the target year. This paper is organized as follows. Section two presents a framework to look at incentives and argues that without the right system in place, the tendency of the education sector will not necessarily be to align its supply with the demands of the labor market. The section discusses some of key features of the system in Indonesia. Section three looks at the performance of higher education graduates in the labor market, their labor force participation, unemployment rates, the types of jobs they obtain and trends in the returns to higher education. Section four takes patterns in employment and returns to education, as well as employer surveys, to find signs of misalignment between supply and demand in the types of degrees of graduates, the sectors where they are employed and the skills they bring with them. Finally, section 5 concludes with some suggested policy directions and future research.

Bibliographic Details

Main Author:	World Bank
Language:	English en_US
Published:	Washington, DC 2014-06
Subjects:	ACADEMIC EXCELLENCE, ACADEMIC QUALIFICATIONS, ACCESS TO HIGHER EDUCATION, ACCESS TO INFORMATION, ACCREDITATION, AUTONOMOUS UNIVERSITIES, BASIC EDUCATION, CERTIFIED TEACHERS, CIVIL SERVICE, COGNITIVE SKILLS, COMMITMENT TO EDUCATION, COMMUNITY COLLEGE, COMMUNITY COLLEGES, COMPULSORY EDUCATION, COUNSELING, CURRICULA, CURRICULUM, DECISION MAKING, DEGREE PROGRAMS, DEGREES, DISADVANTAGED GROUPS, DISTANCE LEARNING, DOCTORAL STUDENTS, EARLY CHILDHOOD, EARLY CHILDHOOD EDUCATION, EDUCATION LEVEL, EDUCATION PERSONNEL, EDUCATION SECTOR, EDUCATION SERVICES, EMPLOYMENT, EMPLOYMENT GROWTH, ENROLLMENT GROWTH, ENROLLMENT RATE, ENROLLMENT RATES, ENROLMENT RATE, ENTRANCE EXAM, EXPENDITURES, FEMALE ENROLLMENT, FUTURE RESEARCH, GER, GROSS ENROLLMENT, GROSS ENROLLMENT RATE, GROWTH IN ENROLLMENT, HEALTH CARE, HIGH SCHOOL, HIGH SCHOOL GRADUATES, HIGHER EDUCATION, HIGHER EDUCATION ENROLLMENT, HIGHER EDUCATION FINANCING, HIGHER EDUCATION INSTITUTION, HIGHER EDUCATION INSTITUTIONS, HIGHER EDUCATION LAW, HIGHER EDUCATION PROGRAMS, HIGHER EDUCATION QUALITY, HIGHER EDUCATION SECTOR, HIGHER EDUCATION STUDENTS, HIGHER EDUCATION SYSTEM, HIGHER EDUCATION SYSTEMS, HIGHER LEARNING, HIGHER LEARNING INSTITUTE, HUMAN DEVELOPMENT, HUMAN RESOURCES, INDEPENDENT LEARNING, INDUCTION TRAINING, INFORMAL EDUCATION, INFORMATION SYSTEMS, INSTRUCTION, INTERNSHIPS, JOB OPPORTUNITIES, JUNIOR SECONDARY, JUNIOR SECONDARY LEVEL, LABOR FORCE, LABOR MARKET NEEDS, LABOR MARKETS, LABOUR MARKET, LEADERSHIP, LEARNING, LEARNING ACTIVITIES, LEARNING CENTERS, LECTURERS, LEVEL OF EDUCATION, LEVEL OF SKILL, LEVELS OF EDUCATION, LITERATURE, MATHEMATICS, MINISTERS OF EDUCATION, MINISTRY OF EDUCATION, NATIONAL ACCREDITATION, NATIONAL ACCREDITATION SYSTEM, NATIONAL EDUCATION, NATIONAL EDUCATION SYSTEM, NER, NET ENROLLMENT, NET ENROLLMENT RATE, NUMBER OF STUDENTS, OCCUPATIONS, OPEN UNIVERSITY, OVERSUPPLY OF TEACHERS, PARTNERSHIP WITH INDUSTRY, PERFORMANCE INDICATORS, PERFORMANCE OF GRADUATES, POLYTECHNICS, PRIMARY EDUCATION, PRIVATE INSTITUTIONS, PROBLEM SOLVING, PROFESSORS, PUBLIC HIGHER EDUCATION, PUBLIC INSTITUTIONS, QUALITY ASSURANCE, QUALITY OF HIGHER EDUCATION, QUALITY TEACHING, RE-TRAINING, READING, REGULAR TEACHER, RESEARCH COLLABORATION, RESEARCHERS, RETURNS TO EDUCATION, RURAL AREAS, SCHOLARSHIP OPPORTUNITIES, SCHOLARSHIPS, SCHOOLING, SCHOOLS, SCIENCE DEGREES, SECONDARY EDUCATION, SECONDARY SCHOOLS, SECONDARY STUDENTS, SENIOR SECONDARY LEVEL, SKILLED LABOR, SKILLED LABOR FORCE, SOCIAL SCIENCE, SOCIAL SCIENCES, SOCIAL SKILLS, STUDENT ASSESSMENT, STUDENT PERFORMANCE, TEACHER, TEACHER CERTIFICATION, TEACHER SALARIES, TEACHER TRAINING, TEACHER TRAINING COLLEGES, TEACHER TRAINING PROGRAMS, TEACHERS, TEACHING, TEACHING STAFF, TERTIARY EDUCATION, TERTIARY EDUCATION INSTITUTIONS, TERTIARY GRADUATES, TRAINING COLLEGE, TRAINING INSTITUTIONS, TRAINING PROGRAMS, TUITION, TUITION FEES, UNEMPLOYMENT RATE, UNEMPLOYMENT RATES, UNIVERSITIES, UNIVERSITY GRADUATES, WORKERS, YOUTH,
Online Access:	http://documents.worldbank.org/curated/en/2014/06/19790477/indonesias-higher-education-system-responsive-labor-market https://hdl.handle.net/10986/20017
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