HomeAbstract of 10th-shconfThe Informality Trap: How Informal Employment Drives Housing Ownership Backlog in Indonesia A Mixed-Methods Panel Data Analysis, 2017-2025

The Informality Trap: How Informal Employment Drives Housing Ownership Backlog in Indonesia A Mixed-Methods Panel Data Analysis, 2017-2025

  • Jun 11, 2026
  • Posted by:
  • Category: Abstract of 10th-shconf
No Comments


Abstract Book of the 10th World Conference on Social Sciences and Humanities

Year: 2026

[PDF]

The Informality Trap: How Informal Employment Drives Housing Ownership Backlog in Indonesia A Mixed-Methods Panel Data Analysis, 2017-2025

Zahra Zahra

ABSTRACT:

Housing ownership backlog remains a critical development challenge in Indonesia, with approximately 11.6 million units in 2022. While prior studies have examined housing affordability and mortgage access, the structural role of informal employment as a determinant of aggregate housing backlog at the provincial level remains underexplored.Objective:This study examines whether informal employment status significantly affects housing ownership backlog across 34 Indonesian provinces from 2017 to 2025.Methods:Employing a convergent parallel mixed-methods design, we combine panel data econometrics (Two-Way Fixed Effects with Driscoll-Kraay standard errors) with in-depth interviews of key housing policy stakeholders.Results:The TWFE estimator yields a statistically significant coefficient of 0.00715 for informal employment, indicating that a one percentage-point increase in the informal labor share raises housing backlog by approximately 0.715 percent, ceteris paribus. The model explains 72.1 percent of variation in log-backlog (R-squared = 0.721). Qualitative triangulation confirms three transmission mechanisms: financial exclusion due to documentary requirements, policy-design mismatch with informal income patterns, and inadequate inter-agency coordination.Conclusion:Informal employment constitutes a structural barrier to homeownership that cannot be resolved through housing supply expansion alone. Cross-sectoral integration of labor formalization, social protection expansion, and inclusive housing finance reforms is essential for sustainable backlog reduction.

Keywords: Informal Employment; Housing Backlog; Homeownership; Panel Data; Two-Way Fixed Effects; Driscoll-Kraay; Indonesia; Mixed Methods