# **5 Findings**

# 5.1 Descriptive statistics and correlation analysis

**Descriptive statistics and correlation analysis allow for an initial view of the relationship between the employment rates of older and younger persons.** In short, this section presents summary statistics and correlations from Sakernas data, which allows for a preliminary understanding of the patterns within the data, focusing on the variables of interest. It provides insight into, for example, the average employment rate within different age groups and genders, and the average hours worked and income earned across these same groups. Correlation analysis provides an initial view into the relationship of interest, that is, between the employment rate of older persons and younger persons across provinces. However, unlike regression analysis, it does not take into account other factors that could be driving the employment rate of younger persons such as the level of development within a province. Therefore, while correlation analysis is useful, it is not sufficient to draw conclusions on the relationship of interest.

**The employment rate is highest for prime-aged persons (25 to 54) compared to youth (15 to 24) and older persons (55 to 64).** The descriptive statistics for the main variables used in the analysis are presented in Annex 1. These reflect 272 province-level observations for 34 provinces including the Special Capital Region of Jakarta for the years 2016 to 2023. The average employment rate of prime-aged persons for the period is 75.5 percent, while the average employment rate of youth and older persons are 38.5 percent and 68.6 percent respectively. The average formal employment rate is lower than the average employment rate across all age groups. Both the average employment rate and formal employment rate for men is higher than that for women, with the exception of the average formal employment rate of youth which is higher for women (28.5 percent) compared to men (21.8 percent). This reflects the higher level of tertiary education attainment among women. In 2023, 6.2 percent of women aged 15 to 24 had a tertiary education, compared to 2.9 percent of men. The average unemployment rate is highest for youth, driven by the high average unemployment rate among female youth. Average hours worked is highest for prime-aged persons. Average hourly income is highest among old persons, while average monthly income is generally highest for prime-aged persons.

**There is a positive correlation between the employment rate of older persons aged 55 to 64 and the employment rate of younger persons, providing preliminary evidence of the lack of an adverse relationship.** Positive correlations between the employment rate of older persons and youth aged 15 to 24 and prime-aged persons aged 25 to 54 across provinces suggest that a higher employment rate among older persons is associated with a higher employment rate among younger persons across provinces for the entire period. There is a substantially higher correlation between the employment rate of older persons and prime-aged persons. The correlation between the employment rate of older persons and youth over time is 0.43, while that between the employment rate of older persons and prime-aged persons is 0.84. The positive correlation holds across genders.

**Similarly, there is a positive correlation between the formal employment rate of older persons aged 55 to 64 and the formal employment rate of younger persons.** This indicates that a higher formal employment rate among older persons is associated with a higher formal employment rate among younger persons across provinces for the period. The correlation between the formal employment rates of older and younger persons is high, with a correlation of 0.55 for that between

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