Febryan Mujahid Panatagama (IPIEF Student)



Human resources always become crucial issues of some developing country like Indonesia. Human resources development could be presumed as a branch of Economic Development which implies to almost socio-economic elements. How could it be a part of Economic Development? What is the meaning of human resources development? Some Human Development theories would also be discussed here with our reaction as the student of economics. What is the condition of Indonesian’s human capital today in facing the globalization and how should we struggle to solve those problems as soon as possible? Starting Indonesian’s Human Resources Development from academic line will be an ending discussion on this writing.

Keywords: Human resources, human resources development, economics, globalization, economic development


On our general presumption, Economic Development consists of two different terminologies which are “Economic” and “Development” itself. “Economic” here refers to something related with the trade, industry and development of wealth of a country, an area or a society; where the “Development” itself refers to the gradual growth of something so that it becomes more advanced, stronger, etc. When we use “Economic Development” terminology we should realize than “Economic” could not stand alone, there should be others aspects that following it. According to Michael P. Todaro, Economic development should be presumed as the multidimensional process involving major changes in social structures, popular attitudes, and national institutions, as well as acceleration of economic growth, the reduction of inequality, and the eradication of poverty.

Economic development born from a huge inequality between the “rich” and the “poor” these could refer to personal, regional, nation or country.  In our opinion, economic development is the long-term process of transmission from zero starting point up to next better advanced conditions. It’s conducted ideally by the government or peoples on their socio-economical issues. Economic development succeed when the “poor” community able to fulfill their basics’ needs of life, to raise their levels of living and expand the range of economic and social choices.

Starting on these considerations stated that one of the economic developments’ objectives is to fulfill the basic needs of human being and we recognized Purchasing Power Parity (PPP) and Human Development Index as its sophisticated parameter. It automatically denoted Economic Development that concerns on Humanity could not be separated with its object which is the Human Capital itself.

The purposes of this writing are to provide useful informative ideas on human resources development and to motivate young readers to be better human resource. Therefore, the discussion will be limited on it definition, theories, academic encouragements and provide some issues related to Indonesian human capital.

  1. I. The Definition of Human resources and Human Resources Development

According to Wikipedia, Human Resource is a term used to describe the individuals who make up the workforce of an organization, although it is also applied in labor economics to, for example, business sectors or even whole nations. Human resources is also the name of the function within an organization charged with the overall responsibility for implementing strategies and policies relating to the management of individuals (i.e. the human resources).

According to Arfida BR, human resources could be defined into two definitions; first it refers to some efforts or struggles given on the production process. In term of it, human resources represent the quality of efforts given by a single individual on a certain period of time for producing any goods or services; second human resources is anything related to the working people that produce several goods or services. Working people means to whom that able to do any valuable economic activities, those activities refer to production process that fulfill social’s needs.  (Arfida BR, 2002, p. 19)

Concerning these definitions we could understand that human resources are one of the important elements of factors of production beside other factors such as capital. It implies that same as capital human resources has a similar characteristic which is limited while the needs of these factors are unlimited. This condition stimulates the existence of Human Resources Management as one other branch of Economic Development itself. It studies how to manage limited available human resource as a factor of production to produce its goods and services on the maximum level.

Based on those following consideration we could conclude that Human Resources Development refers to the gradual growth of human capital so that it becomes more advanced, stronger, and have better capacity to maximize their production of goods and services.

  1. II. Human Development Theories

Principally, in term of Human Development neoclassical model focuses on the self-interest and very mundane aspect of human life. (Masyhudi Muqorobin, 2008, p.1). According to Arfida BR, neoclassical economists presume that every individual with its own tastes, preferences, needs, and wants is struggled to get their satisfactory by fulfilling their needs on physical consumptions. While it’s general acknowledgment human development theory is a theory that merges older ideas from ecological economics, sustainable development, welfare economics, and feminist economics.

Furthermore, on its development there are some contemporary economists that develop their own theory on human capital such as Amartya Sen that build her theory about Human Development Theory, one of those economists is Amartya Sen is an Indian-born Cambridge economist who won the Nobel Prize in Economics in 1998. He was praised by the Prize Committee for bringing an “ethical dimension” to a field recently dominated by technical specialists. Based on the example of the former Soviet Union, Sen argued that political liberties are necessary for sustainable development. He also compared the development strategies of India and China, arguing that Indian democratic processes provide a firmer guarantee of long term stable growth. Sen argued against the notion that a specific set of “Asian values” exists that might provide a justification for authoritarian regimes.

Amartya Sen puts forth the argument that all individuals are endowed with a certain set of capabilities, while it is simply a matter of realizing these capabilities that will allow a person to escape from poverty and their state of ‘unfreedom’. In this detailed account, Sen questions the status quo of development economics and argues that income poverty should not be the single most important factor in determining development. Sen argues that though today we live in a world of sheer abundance, there simultaneously exists populations’ living in a state of ‘unfreedom’, unable to realize their capabilities.

Sen attempts to expand the basic interpretations of freedom by examining five elemental forms of instrumental freedoms: political freedoms, economic facilities, social opportunities, transparency guarantees, and protective security. Each form of freedom is complementary to each other, remaining interrelated and inextricable. These freedoms constitute not only the means, but also the ends in development. Poverty, Sen asserts, should be seen “as a deprivation of basic capabilities, rather than merely as low income” (Sen, 1999), contesting the general belief amongst economists who view income as the be all and end all of development. (http://en.wikipedia.org/wiki/Human_development_theory)

As our first beginning consideration that human resource born with the problem of economic, human beings which are should fulfill their basic needs and increase their level of live should work and indirectly build their national economy as human capital (workman) the right management of human resource create a better condition of human being’s level of live (higher income) and automatically support their national economy as whole.

  1. III. The Condition of Indonesian’s Human Capital in Facing “Globalization” and its Problems.

The world multidimensional crisis occurred lately brought some bad impacts for economic depression due to Indonesians human capital burring as the negative results of globalization. Beside the globalization the impact of Indonesian long economic stagnation today caused into some companies bankruptcy that caused into a huge increases in the unemployment numbers. This condition is getting worse due to the durability, capacity and the quality of human capital in Indonesia. The quality of Indonesian human capital is extremely appealed with the quantity of human capital itself.  This condition becomes one problem that blocked Indonesian economic development and the development of human capital itself.

Unfortunately Indonesian government doesn’t really concerns on these issues. It proved with the lower level of national budget given by government for educational sectors which is not more than 12% on the reformation period. And it’s get rather better or bad in 2011 which is not more than 20% or about IDR 50, 3 Billions or decreased dramatically from the year before 2010 which is about IDR 60 Billions. (Detik.com, 17/08/2010, 13:00 WIB) this calculation don’t includes the amount of budget ineffectively from some corrupted bureaucracies and other educational issues occurred in Indonesia.

This factual condition shows that there is no suffiecient will of Indonesian goverment to increase the quality of its human capital. Wherease it should be done as soon as possible and really Indonesian nation should build its qualified human capital to maintain and maximize its huge potention of its natural resources in order to realize the national economic power.

The not working people or unemplyomed is one of national economic problem which is really difficult to be solved. In general acknowladgment there are three major obstacles of unemployement; the first is ”the cultural barriers”, educational curiculum and labour market. The cultural barriers here refer to culture and the ethos of working. The educational curriculum obstacle refers to unavailability the definitive formed curriculum that able to creates and develope human capital self-suffiency swiched with the demands on laboforce itself. And on the last point the obstacles on the maker of labour is merely coused of lowest quality of Indonesian human capital.

The 21st century economic era is explicitly indicate with the runs of economic globalization which is an economic trading activities where some nations all over the world became an intergrated market power with no boundes of inter-national teritories. Whatever it is Indonesis should face globalization, this condition requires national efficiency and compititive power of national bussiness. According to the World Competitiveness Report Indonesia reported on the 45th position or the lowest level among the researched countries, indonesia left far away from Singapore (8th), Malaysia (34th), Philipines (38th), and Thailand (40th).

On its development, globalization gives some implication on the development of human capital in Indonesia. The main problem on developing Indonesian human capital is missalocation of human resources and mismanagement of potential natural resources. On the orde before reformation period labor market follows the era of ”high cost economy”. Where human capital tend to get involve that conglomerative lines which is starting at manufacturing up to banking industries. Due to these reasons educational lines involved on the aimlessly eco-political conflicts, likes economic asymetry that accelerates on the destortion of market’s structures. The ironic fact that some of the best graduatioins that involved on almost economic sectors were not solving those economimc problems, but they unfortunatly strengtenting the concentrated high cost econonomies, that sharpening an economic asymentries. That phatetic condition occures because of the vision of almost Indonesian human capital is limitted on the existing less-condusive markets’ sturcture and does not able yet to create their own market, due to some macroeconomic condition that not yet condusive enought fot it.

The asymetric Indonesian human capital development could be indecated not only by the big different of human capital educational beckgrounds on one regional/province with others, but also on one city with one village in the scope of Indonesian country. This condition supported with the minimum availability of educational facilitites such as the availability of teachers in a certain remoted villages. Therefore, it will be so difficult for Indonesia to improve the its people’s living quality and its human capital capacity if Indonesian government unable to fix those problems.

  1. IV. The Strategy to Improve Indonesian Human Capital’s Qualifications

To faster the developing process of Indonesia toward well developed country with competitive human capital; at least there are four potential strategies to be done such as:

  1. Defensive Strategy

It refers to human capital development’s strategies that have so many shortcomings and always pressured with foreign parties. This kind of strategy is insisting on the activities that oriented with how to defense human capital sector and Indonesia human capital that less-competitive.

  1. Conservative Strategy

It refers to human capital development’s strategies that have so many shortcomings, but it has potential opportunities to be developed. Programs and strategies here emphasized on some activities orient to strengthen by the Indonesian human capital basis such as the architectures lines, art’s works, movies and entertainments etc.

  1. Competitive Strategy

It refers to human capital development’s strategies that already have competitiveness on business, but facing some threats from foreign power (Imports). Programs and strategies here are emphasized on the human capital competitiveness improvement with its new innovative works, the improvement of Indonesian Workers to Foreign nations (TKI) etc.

  1. Aggressive Strategy

It refers to human capital development’s strategies that already have some powers and opportunities to develop continuously. Programs and strategies here are insisted on some activities orient to the values’ growth of Human Capital; such as invention of new innovations, the improving on the competitiveness and the development of professional human capital allocation on the potential pos and strategic sectors such as mining, technological development, or an expert of petroleum.

Those following strategies should be conducted integrally with others factors existing. Government though its related ministries should find the proper combination to solve and develop those mentioned strategies and programs for sure it should be suited with Indonesian frequent socio-economic dynamical condition.

  1. V. How to Start Indonesian’s Human Resources Development Beginning from Academic Environment

If we discus about early development of human capital it really suitable if we start from academic institution such as collage and campus as the good starting point. So that entrepreneurship mental is about a magical word for almost people that lately becomes a bit dilemma among Indonesian collegian. “Entrepreneur” in our consideration could be very dangerous particularly for those who still on their student’s degree. But it should be conducted as a good starting point to develop the quality of Indonesia human capital development. Some considerations should be concerned in term of collegian entrepreneurial activities. Those considerations and its problem solving will be discussed further.

  1. VI. The Definition of Entrepreneurship and Entrepreneur

According to Wikipedia, In general knowledge entrepreneurship is the act to be an entrepreneur, or someone who innovate some ideas to have any venture. It might be caused into some organization, enterprise or business company. According to Richard Cantillion the first Irish-French economist who was defined this terminology; original entrepreneur refers to a loan word (French) or a person who us willing to launch a new venture or enterprise and accept full responsibility for the outcome. IN 1800’s Jean Baptiste Say defined an entrepreneur is one who undertakes an enterprise. But after years people start to enlarge the essence of entrepreneur to some wider lines including socio-politics entrepreneurial activities. With refer to these acknowledgment we could easily conclude that an entrepreneur is not merely a materialistic or business activities but more. It could be any social or political entrepreneurial actions. The thing that I’m trying to express is smart entrepreneurial acts that suitable for student/collegian degree.

  1. VII. The Definition of Young Entrepreneur

After a brief discussion on entrepreneurship and something related on it we would like to describe about young entrepreneur meaning. A young entrepreneur seems to be different term but it’s actually the same with entrepreneur in general. We just see an adjective “young” before entrepreneur term. The word young with refer to Webster English dictionary could be defined in several meanings such as being the first or an early stage of life, growth, development, junior, having little experience, recently come into being etc. Here we tend to define a young entrepreneur as those who recently come to be an entrepreneur and still have little experience on it.

  1. VIII. Why entrepreneur could be dangerous?

In our humble consideration for some circumstances entrepreneurship could be harmful for those who still in their student or bachelor degree. In ideal condition a student or collegian should focus on their study first than spending their time and energy to looking for pennies. For real there are many students or collegians that too busy on their business then their collage. Some friends of me event should spend their study’s period 3 up to 4 years more than the normal one. Another reality is some of my friend also trapped on excessive debts with some financial institutions like bank, debt collector or event with their friends and colleagues. Finally, when their business suffered some lost their school or university fees are scarified for debt payment or event they unable to pay it.

Furthermore, beside disturbs academic activities and debts problem there are other bad impacts that might be occurred due to over in entrepreneurial activities. For physiological aspects students or collegians which are in their young ages tends to be materialistic person during their business activities. They will begin to measure everything with money, seems that there is no something valuable that could not be measured with money. In this case, when they succeed on their business activities parental guidance is a necessity in order to balance their success with some other spiritual maintenance such as religion or social responsibility.

  1. IX. Starting Smart Entrepreneurship for Collegian

On these argumentations we do not presume that starting to be entrepreneur earlier or in our young ages is bad at all but, what we are going to assume is we should start our early entrepreneurial activities smartly. Smart entrepreneurship refers to entrepreneurial activities to gain some profits with minimum risks and capitals. We realize that young people will not have much capital as much their expectation. Some of them also have no sufficient mentality to play on big capital business.

Back to our first consideration that entrepreneurship is not merely business activities but including socio-political activities. This condition allows those that still on their study’s period to expand any entrepreneurial activities. Refers to our first consideration a young entrepreneur is not only those who exist in direct business activities such as trading, foreign currency, financial market or other business activities that need amount of capitals and a lot of risks. But also those who struggle on their studies, produce some academic writing and achievements became the function of collegian productivity and result of their opportunity cost scarified by paying some amount of school fees; simply we could presume that studying is also the shape of promising business activities that could improve their capacities and qualifications in term of their possibility to be a good potential Indonesian human capital.

We presume that young entrepreneur especially for students moreover collegians should start to enterprise smart business such as establishing or joining “koperasi” cooperation. When we join cooperation it means that we will share not only our capitals, profits, lost and also the risks. So it will not impact our academic acts much. When we talk about cooperation it means that we will talk about low-end profits gains as low as our low capital that being invested there. Low returns might be no so good, but we could experience much there. Beside we could study from other members of cooperation in business, we able to have direct experience in the business activities. Cooperation not merely business activities but, it include leaderships forum, social forum and legal organizational institutions that ratified by the constitutions. Since that cooperation is mushrooming lately, student and collegian could access it everywhere such as Students Cooperation, Campus Cooperation, Employees cooperation etc.

Last point of this discussion is how student and collegian should face their desire to be an entrepreneur. After our long discussion with some Entrepreneur University’s students, we could conclude that being an entrepreneur is something necessary but it should be prepared well. According to them a success entrepreneur is those who are all out on their entrepreneurship. Therefore, young entrepreneur including student and collegian should be really careful to have their entrepreneurship.

  1. X. Conclusion

Indonesia as a developing county should realize that its development really depend on its human resources development, unfortunately Indonesian government don’t really intended to solve some critical problems related to human resources. But anyway as one of Indonesian human capital, staying quite and being a passive human capital is unforgivable. As student of economic on the bachelor degree we are claimed to be able to solve or at least help the government in solving human development problems. The lowest minimum effort that we could struggled as soon as possible are to analyze and identify our human resources miscellaneous obstacles and how to solve it. Less government supports, cultural barriers and less competitiveness become the major problem of Indonesian Economy today. Defensive, conservative, competitive and aggressive strategies should be conducted by the government. And our final struggles as a collegian to help in solving those discussed problems is by doing smart entrepreneurial activities.












Karim Adiwarman A, Ekonomi Islam Suatu Kajian Kontemporer (Jakarta: Gema Insani, 2001)

BR Arfida, Ekonomi Sumber Daya Manusia (Jakarta: Ghalia Indonesia, 2003)

Fadjar Malik, Platform Reformasi Pendidikan dan Pengembangan Sumber Daya Manusia, (Jakarta: Logos, 1999)

Tumpman Simon, Mengapa Entrepreneur Perlu Makan Pisang, (Jakarta: Liblr, 2005)

Todaro P. Michael, Economic Development, (London: Addison Wesley Longman, 2000)

Restricted sources:



http://www.geogle/SDM Indonesia dalam persaingan global/.co.id