Abstract

Youth (15-24 years) are in a transition period from school to the world of work or to higher education, so they are vulnerable to dropping out of school or becoming unemployed. This has the potential to cause problems in employment, namely the presence of young people who are not working, attending school or training or are called NEET (Not in Employment, Education or Training) youth. This study wants to determine the influence of human capital on the risk of youth becoming NEET in Indonesia. The empirical analysis was based on the micro-data of the Indonesian Labor Force Survey (Sakernas) and contextual factors. Multinomial logit analysis and multinomial logit multilevel regression support the heterogeneous nature of Indonesian NEETs confirming the human capital framework. They show that higher education does not provide a universal safety net from NEET status in Indonesia. NEET-unemployment in Indonesia is associated with higher education. Young undergraduate graduates are more likely to be NEETs than vocational graduates in Indonesia. Results contribute to the ongoing discussion about the changing rates of return for higher education and the saturation of the Indonesian labor market with university graduates