The Effect of Host Country Economic Performance on Indonesian Migrant Workers: A Sectoral Analysis

This study analyzes how sectoral economic performance in host countries affects the migration flows of Indonesian Migrant Workers (IMWs) from 2014 to 2023. Using panel data from 13 major destination countries and applying fixed effects and robust estimation methods, the study examines the influence of manufacturing, agriculture, industry, and services sectors alongside demographic and structural factors. The results show that growth in manufacturing and agriculture sectors tends to reduce IMW flows, while higher old age dependency ratios significantly increase demand for Indonesian workers, especially in care related services. Geographic distance negatively affects migration, consistent with gravity model predictions, whereas unemployment rates show limited influence. The findings highlight that sector specific conditions and demographic pressures, rather than aggregate economic indicators, play a central role in shaping Indonesian labor migration. The study provides policy recommendations focusing on skills development, sector based deployment strategies, and strengthened bilateral labor agreements. JEL Classification: F22, J61, 015