Gross Value Added of Manufacturing Industry: Determinants and Impact on Economic Growth and Employment Absorption in Java and Bali

The gross value added of the manufacturing industry is a key indicator for measuring the sector's contribution to Gross Domestic Product (GDP) and economic growth, as well as its ability to create jobs. This study aims to analyze the factors influencing the value added of the manufacturing industry and their impact on economic growth and employment in Java and Bali. These factors include investment, labor productivity, and inflation. This study uses a panel data regression method with annual data from 2017 to 2023 in seven provinces in Java and Bali. The results of the study indicate that partially investment has a significant effect on gross value added, labor productivity has a significant effect on gross value added, and inflation has a significant effect on gross value added. Simultaneously, investment, labor productivity, and inflation have a significant effect on gross value added. Gross value added has a significant effect on economic growth, and economic growth has a significant effect on employment absorption.