The Effect Of Road Infrastructure, Investment, Labor, And Regency/City Minimum Wages On The Manufacturing Sector In West Nusa Tenggara Province, 2019–2024

Abstract

The development of the industrial sector is an important factor in promoting regional economic growth through increased production, employment creation, and value added. Several economic and production issues impact the growth of West Nusa Tenggara Province's industrial potential. The purpose of this research is to examine the relationship between industrial development (as indicated by the manufacturing sector's GRDP in the regencies and cities of West Nusa Tenggara Province from 2019 to 2024 and factors such as road infrastructure, investment, labor, and regency/city minimum wages. Using secondary panel data spanning ten regencies and cities over six years, with a total of sixty observations, this research utilizes a quantitative method. Using EViews 12, panel data regression was used to evaluate the data. Model selection tests led to the conclusion that the CEM was the best fit. Industrial development is negatively and significantly affected by road infrastructure, negatively and insignificantly by investment, positively and significantly by labor, and positively and insignificantly by the regency/city minimum wage, according to the data. All four independent factors impact the manufacturing sector's GRDP at the same time. Industrial development can be described by the variables included in the model to the tune of 93.89% (R-squared = 0.938944), with the remaining 6.11% attributable to factors outside the purview of the research. Based on these results, West Nusa Tenggara Province has to spend more, build more egalitarian infrastructure, and improve the quality of its workforce if it wants to foster industrial growth.