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8/2/2019 Women Entrepreneurship in Indonesia: Constraints and Motivations (ongoing study)
1/20
WOMEN ENTREPRENEURSHIP IN
INDONESIA: CONSTRAINTS AND
MOTIVATIONS
(ongoing study)
Tulus T.H. TambunanCenter for Industry, SME and Business
Competition Studies, USAKTI
The views expressed in this paper are the views of the author and do not necessarily reflect the views or policies of the AsianDevelopment Bank (ADB), or its Board of Governors, or the governments they represent. ADB does not guarantee the accuracy ofthe data included in this paper and accepts no responsibility for any consequence of their use. The countries listed in this paper donot imply any view on ADB's part as to sovereignty or independent status or necessarily conform to ADB's terminology.
8/2/2019 Women Entrepreneurship in Indonesia: Constraints and Motivations (ongoing study)
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Main objective: to examine the development of women
entrepreneurs in Indonesia with the focus on MSMEs.
Three research questions:
how has been the development of women entrepreneurs,
especially in MSMEs in Indonesia recently?
what are the main constraints for women to become
entrepreneurs in Indonesia?
what are the main motivation/reasons that women conduct
their own business instead of working as wage-paid
employees or staying home doing domestic works.
Methodologically,
analysis of secondary data
review on key literature on women entrepreneurs in
developing countries and Indonesia
field survey
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DISCUSSION:
1) Key Characteristics of MSMEs
2) Development of MSMEs (in brief)
3) Picture of women entrepreneurs in Indonesia
4) Field survey: Preliminary findings
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Aspect MIEs SEs MEs
ormality operate in
informalsector,
unregistered
& pays notaxes
some
operate informal
sector,
registered &pay taxes
all operate in
formal sector,registered & pay
taxes
ocation Majority in
rural areas/villages
Many in
urbanareas/cities
Mostly in urban
areas/cities
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Aspect MIEs SEs MEs
Organization
&
management
- run by the
owner
- no internal
labor division
-no formalmanagement
&
accounting
system
(bookkeeping)
- run by the owner
- no labor division
(majority),
-no formal management
and accounting system(bookkeeping)(majority)
-many hire
professional
managers, -many
have labor division,
formal organizationalstructure & formal
account-ting system
(bookkeeping)
Nature of
employment
majority use
unpaid family
members
some hired wage
laborers
-all hired wage
laborers
-some have formal
recruitment system
Nature of
productionprocess
- degree of
mechanizationvery
low/mostly
manual
- level of
some use up-to-date
machines
many have high
degree ofmechanization/access
to modern
technology
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Aspect MIEs SEs MEs
Market
orientation
majority
sell to local
market and
for low-
incomeconsumers
-many sell to
national market
and export
-many serve
also middle tohigh-income
group
-all sell to
national
market and
many also
export- all serve
middle and
high-income
consumers
Social &economic
profiles of
owners
- low oruneducated
- from poor
households
- main
motivation:
survival
- some havegood education,
and from non-
poor households
- many have
business/profit
motivation
- majorityhave good
education
- many are
from wealthy
families
- main
motivation:profit
Sources of
inputs
- majority
use local
raw
- some import
raw materials
-some have
- many use
imported raw
materials
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Aspect MIEs SEs MEs
External
networks
- majority
have no
access togovernment
programs
and no
business
linkages
with LEs
- many have
good relations
withgovernment
and have
business
linkages (such
as
subcontractin
g) with LEs
(including
MNCs/FDI).
- majority
have good
access togovernment
programs
- many have
business
linkages
with LEs
(including
MNCs/FDI)
Women
entrepreneur
s
ratio of
female to
male as
entrepreneur
s is the
highest
ratio of
female to
male as
entrepreneurs
is high
ratio of
female to
male as
entrepreneur
s is low
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Total enterprises by size category in all economic sectors
(000 units)ize
ategory
2000 2004 2007 2008 2009
IEs &Es 39,705 44,684.4 47,720.3 52,327.9 52,723.5
Es 78.8 93.04 120.3 39.7 41.1
Es 5.7 6.7 4.5 4.4 4.7
otal 39,789.7 44,784.1 49,845.0 52,262.0 52,769.3
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Women Entrepreneurs in Indonesia
Some indicators
1) Global Gender Indexfrom the World Economic Forum (WEF):gender gap in:
-in economic participation and opportunity
-education
-health and survival
-political empowerment
2) Gender Equity Index (GEI) developed by Social Watch: gender-
based inequities in:
-education,
-economic participation
-empowerment
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The Gender Gap Index of Indonesia, 2010
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Ranks of ASEAN Countries for GEI and Its Dimensions, 2009
Country GEI Education Economic
Activity
Empowerment
Cambodia
Indonesia
Lao, PDR
MalaysiaPhilippines
Singapore
ThailandViet Nam
62
55
52
5876
63
7074
78.1
96.8
80.6
98.698.5
95.0
98.396.5
83.5
52.8
59.2
46.663.5
58.6
71.781.3
23.2
16.0
16.8
29.764.8
36.5
40.644.0
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3. National Labour Survey: Employment by
Status and Gender4. National Enterprise Survey by Gender of
Owners
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Table 5: National Labour Survey: Employment Status by Gender in Indonesia, 1990-2006 (%)1990 1995 1996 1997 1998 1999 2002 2006 2011
Male
Paid worker 31.9 39.1 38.4 39.4 36.1 36.2 29.4 35.2 35.9Doing own business with paid worker 1.1 2.1 1.8 2.2 2.3 3.4 4.1 4.0 4.4
Doing own business without paid worker 53.6 50.1 52.1 50.3 52.7 51.9 59.4 53.2 39.99
Family worker 13.5 8.7 7.7 8.0 8.8 8.5 7.0 7.7 19.71
Female
Paid worker 22.8 29.2 27.4 29.0 27.7 28.1 37.3 31.5 32.1
Doing own business with paid worker 0.3 0.7 0.8 0.8 0.8 2.0 1.1 1.1 1.7
Doing own business without paid worker 30.2 36.8 38.5 34.5 34.9 35.8 25.4 33.2 28.5
Family worker 46.6 33.3 33.4 35.7 36.6 34.2 36.2 34.1 37.7
Male + Female
Paid worker 28.4 35.6 34.2 35.5 32.9 33.1 32.3 33.9 44.6
Doing own business with paid worker 0.8 1.6 1.4 1.7 1.7 2.9 3.0 3.0 3.4Doing own business without paid worker 44.5 45.4 46.9 44.3 45.9 45.7 47.2 46.2 35.7
Family worker 26.3 17.4 17.5 18.5 19.5 18.3 17.6 16.9 16.3
Owners of MSEs by Gender and Non agricultural Sector 2003 (unit)
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Owners of MSEs by Gender and Non-agricultural Sector, 2003 (unit)
Sector Total
units
Owners
Male Female
ining, electricity (non-Statedwn/PLN) & construction
ndustry manufacturing
rade, hotel, & restaurant
ransportation & comm.
inancial inst, real estate,
enting, and services
otal
(100.00)*
(100.00)
(100.00)
(100.00)
(100.00)
(100.00)
(93.64)[2.21]
(61.93)
[15.25]
(61.21)[52.64]
(98.60)
[19.94]
(71.80)[9.97]
(68.00 )
[100.00]
(6.36)[0.32]
(38.07)
[19.91]
(38.79)[70.86]
(1.40)
[0.60]
(28.20)[8.32]
(32.00 )
\
[100.00]
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Owners by Gender of MSMEs in Manufacturing Industry, 2006 (%)
Gender Size
MIEs and SEs MEs MSMEs
Male
Female
Total
77.33
22.67
100.00
83.75
16.25
100.00
71.01
28.99
100.00
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Main Constraints to Become Entrepreneurs:
- Education- Heavy household works/responsibility
- legal, traditions, customs, cultural or religious
constraints- lack of access to formal credit and financial
institutions.
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Field Survey: Personal Motivation
Options:
(1) to be independent
(2) to explore or to develop own hobby/skill;
(3) because of difficulty in finding jobs
(4) to support family/household income or to add extra incometo husbands low income;
(5) to response to market opportunities;
(6) to continue family traditional business;
(7) to realize long personal wish or dream;
(8) want to be rich or famous.
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Total Respondents by Main Motivation/Reason to Undertake Own Businesses 2011 (person)
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Research Agenda
Issues:
what institutions facilitate or hinder women decisions to enterinto entrepreneurships?
do female entrepreneurs face more constraints than male
entrepreneurs in running their businesses?
are the majority of women entrepreneurs in Indonesianecessity entrepreneurs or opportunity entrepreneurs?
as Indonesia consists of more than hundred different ethnic
groups with their own local languages, cultures, traditions,
and adopted norms, does the intensity of women
entrepreneurship vary among these different ethnic groups?