Labor Gap Analysis in Supporting Digital Economic Growth in Indonesia

Abstract

The digital economy has become one of the main pillars of global economic growth, including in Indonesia. However, one of the main challenges faced is the workforce skills gap, which can hinder the potential of the digital economy to develop optimally. This study aims to analyze the influence of various economic variables, such as inflation (INF), gross domestic product (GDP), unemployment (PG), internet users (PGI), and labor (TK) on the growth of the digital economy in Indonesia. Using the Vector Autoregression (VAR) model and Impulse Response Function (IRF) analysis, this study evaluates the dynamic relationship between these variables in the short, medium, and long term. The results of the VAR test show that lag 2 is the most appropriate model to describe the relationship between variables, with a lower Akaike Information Criterion (AIC) value than lag 2, which is 25.81693 compared to 19.89891. The IRF results indicate that inflation and GDP provide positive responses in all periods, while unemployment shows a positive response in the short term but turns negative in the medium and long term. Internet users and workforce showed a consistent positive impact across all periods, underscoring the importance of digitalization and strengthening workforce skills in supporting the growth of the digital economy. To maximize the potential of the digital economy, Indonesia needs to focus on improving workforce skills, investing in technology education, and developing equitable digital infrastructure. With the right strategy, the digital economy can become a major driver of sustainable economic growth in Indonesia.