Human Resource Quality and Household Income in North Sulawesi, Indonesia

Household income is a very important economic variable to measure purchasing power of household. The higher the household income the higher the purchasing power and, thus, the better is the level of needs fulfilment and the higher the level of economic well being or welfare. This research was conducted to find out the influence of human resource quality on household income. Household income is the total income (in rupiah) of a household in a year. The level of education and entrepreneurship were chosen as proxies of human resource quality; entrepreneurship is then represented by commitment and perseverance, initiative and action, as well as adaptive ability. This research was done in urban areas of North Sulawesi in the cities of Manado, Bitung, Tomohon, and Kotamobagu as well as Tahuna. Tahuna is the capital of Sangihe Archipelago Regency. The sample of this research consists of 340 households in with the heads of households and/or housewives were chosen as respondents. The respondents are the households of various main job: civil servant including teachers, business persons, farmers, and fishermen. The respondents were chosen purposively in order to be able to answer the questions in the questionnaire. Data analysis was conducted using multiple linear regression model. This research finds that education and entrepreneurship have simultaneous-positive influence on household income in North Sulawesi Province of Indonesia. Partially, every independent variable (the proxies), unless commitment and perseverance, has significant-positive influence on household income. This finding gives implication that it is very important to increase the quality of human resources education and entrepreneurship to increase income and, thus, economic welfare, of households in the region.