Creating Job Opportunities in Rural Areas

Oil palm plantations are pro-job rural economic sector.

Overall, the education level of the population in rural areas is generally low. Therefore, to reduce poverty in rural areas, we need to develop economic sectors that absorb more labor in accordance with the characteristics / background of rural labor. Oil palm plantation is an economic sector with labor intensive technology. Not only is it labor intensive but it is also accommodating to the diversity of quality / skills of rural workers.

The absorption of labor in oil palm plantations in Indonesia has increased from year to year along with the expansion of plantations, increased production and the development of upstream and downstream industries. In 2000, the number of workers working on oil palm plantations was only around 3.4 million people, then increased to 9.3 million people in 2013. Assuming that each worker is responsible for 4 family members, then by the number of workers in 2013, then around 37 million people had a source of income from oil palm plantations.

Job opportunities are not only created in oil palm plantations if oil palm plantations develops. The growth of palm oil production (CPO) will create new employment opportunities in other sectors through the multiplier effect of CPO growth itself in the rural areas. Based on empirical studies, the multiplier effect of employment opportunities on oil palm plantations creates new employment opportunities in the economy where around 10 percent occur outside of oil palm plantations.

If CPO production increases (due to market demand), employment opportunities will not only grow in oil palm plantations, but also in other sectors. Even the multiplier effect of CPO production growth also increases new employment opportunities in the urban sector such as the financial sector and the chemical industry. This shows that oil palm plantation is a sector that effectively reduces unemployment, especially in rural areas.

The technological characteristics of oil palm plantations are labor intensive and accommodating to a variety of labor quality qualities such as the low-income people in rural areas, making oil palm plantations a part of important solutions to reduce unemployment or provide employment opportunities for the rural people. With this fact, oil palm plantation is a pro-job rural economic sector.

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