The Impact of Labor Market Inequality on the Income of Medium Industry Sector’s Workers in the Palembang City-Indonesia

Abstract

This study attempts to investigate the impact of labor market Inequality on the income of
medium industry sector’s worker in the Palembang City-Indonesia. Using 380 respondents
which covers male and female workers ranging from the age of 15 to the age of 64, this study
employs a proportional stratified random sampling in determining the sampling technique.
This study employs a survey method using in-depth investigation to explore all the facts
acquired about the labor market inequality in the medium industry sector. The sample area
includes 16 districts in the City of Palembang. The level of education, the job’s capability and
the working experience are some of those factors investigated in this study. The factor of
labor market inequality is focused on the wage and employment. The result reveals that apart
from the level of education, the job’s capability and working experience have a significant
impact on the existence of labor market inequality in the medium industry sector. It can be
concluded that higher level of education is inessential for the medium industry sector in
Palembang City-Indonesia, and this is inline with the notion that the medium industry sector
merely requires both working’s capability and spesified technical skills in supporting higher
productivity level. The inequality occurs in the wage and the job assigned. Furthermore, the
higher the existence of labor market inequality, the lower the income acquired by the
employees.