Abstract

This study aims to explore the role of The development of human resources (HRD) with human capital indicators in reducing unemployment rates, increasing labour participation and net immigration, and its impact on the population in Indonesia. This study also explores the dynamic relationship between human resource development, unemployment, labour participation, immigration, and a population that influences each other. In order to do this, the vector error correction model (VECM), which enables hypothesis testing and the accomplishment of research objectives, is employed in conjunction with a quantitative research approach. This analysis makes use of World Bank secondary data for the years 1990–2023. The findings demonstrate that efficient human resource development raises the standard of instruction and workforce competency, which reduces unemployment by making individuals more ready to enter the labour market. Improved skills and education also increase labour participation because more individuals are able and willing to work. On the other hand, increased labour participation and reduced unemployment create a stable and attractive economic environment for investment, open up more job opportunities, and improve people’s welfare. Increasing job opportunities domestically reduces the urge to migrate abroad, reducing net immigration. In addition, inclusive HRD development and increasing economic welfare affect population growth. Better education, especially for women, is often associated with lower birth rates as women tend to delay marriage and have fewer children. Thus, human resource development impacts the economic aspects and demographic and social dynamics in Indonesia. In order to improve people’s welfare and promote sustainable economic growth, national human resource management plays a significant role in coordinating and optimizing the growth of human capital in Indonesia through policies that support raising the standard of education and training, lowering access disparities, fostering innovation and creativity, and establishing a favourable work environment.