Study of Quantitative Approach on Wage Differentiation of Worker in Papua Province

Inequitable distribution of income is an essential issue in the development plan because it has a direct link to welfare. Papua is one of the provinces that are dealing with this issue. It is known from both indicators which the work participation rate and the poverty rate were high. Therefore, this study will describe the factors that influence the wage differentials of workers in Papua so that the government has a more accurate picture of policy steps. This study uses the classification and regression tree (CART) analysis of the 2019 National Labor Force Survey (SAKERNAS). The results of the study show that from five predictor variables used, four of them can explain the phenomenon of wage differentiation in Papua. The four variables are the use of IT in employment, business sector, gender, and education level. In the meantime, rural-urban classification variables do not have a substantial role in influencing workers' wage differentiation. Based on the results of the study, the government should make a long-term investment in improving the quality of human resources, and making regulations that are pro to gender equality. They also should focus on efforts to penetrate technology in the business, and create the relevant programs to boost the added value in the sector of agriculture.