Exploring Accessibility to Subsidized Housing: An Analysis of the Impact of Minimum Wages, Population, and Unemployment Rate in Central Java

Abstract

This study aims to examine the influence of regional minimum wage (UMK), population size, and unemployment rate on subsidized housing ownership in Central Java Province. Using panel data from 33 districts/cities spanning the period 2020 to 2023, the analysis applies the Ordinary Least Squares (OLS) method to assess the relationship between these macroeconomic variables and subsidized housing ownership. The estimation results reveal that all three variables jointly influence the level of subsidized home ownership, albeit with differing directions and significance levels. Among them, the regional minimum wage exerts the most substantial and statistically significant positive effect, reinforcing the critical role of income policy in enhancing access to affordable housing for low-income groups. Population size also shows a positive but less significant effect, suggesting that demographic pressures may increase housing demand without necessarily translating into ownership. Conversely, the open unemployment rate has a statistically significant negative effect, indicating that higher unemployment undermines the ability of households to purchase homes, even when subsidized. These findings underscore the need for integrated policy measures that go beyond wage adjustments, including job creation, financial education, and the promotion of public-private partnerships (PPP) to expand housing availability. Strengthening the effectiveness of housing financing schemes like FLPP and further research into social and cultural determinants are essential for ensuring the long-term sustainability and inclusivity of subsidized housing programs in Central Java.