Analysis of the Effect of Labor Force, Education Level, and Investment on Economic Growth and Their Impact on Poverty in North Sumatra from 2016 to 2025

Abstract

This study aims to analyze the influence of the labor force, education levels, and investment on economic growth, as well as their impact on poverty in North Sumatra Province during the 2016 – 2025 period, with economic growth serving as an intervening variable. The study employs a quantitative approach, Path Analysis, and secondary data from Statistics Indonesia (BPS) analyzed using EViews 13. The results indicate that the labor force has a significant negative effect and education levels have a significant positive effect on economic growth, whereas investment has no significant effect. Regarding poverty, investment and economic growth have a significant negative effect, while the labor force and education levels do not have a significant effect. The Sobel test reveals that economic growth mediates only the influence of the labor force on poverty. These findings underscore the importance of improving workforce quality and fostering inclusive economic growth as strategies for poverty reduction in North Sumatra Province.