Income Analysis of Paddy Farmers in Malang District

Dian Rachmawati*, Rizky Dwi Putri, Rizza Megasari, Sri Handayani

Economic Faculty, Universitas Negeri Malang

Keywords: capital, arable land area, level of education, amount of labor, age, number of family dependents, income

Abstract: Factors that influence the income of rice farmers include capital, arable land area, level of education,

number of workers, age, number of family dependents. The purpose of this study was to determine the size

of the capital factor, the area of arable land, the level of education, the amount of labor, age, the number of

family dependents significantly influence the income of rice farmers in Donomulyo Village, Malang

Regency. This research was carried out by simple random sampling. In this study, the study population is

the whole family of farmers who own agricultural land who have a livelihood in the agricultural sector in

Donomulyo Village. To analyze the influence of these factors, multiple linear regression analysis is used.

Data processing using SPSS 20 for Windows software. The results of this study indicate that the variables of

capital, area of arable land, level of education, number of workers, and age have a significant positive effect

on the income of rice farmers, while the variable number of family dependents used in this study has no

significant positive effect on the income of rice farmers. From the analysis of 85.9% variables of capital,

land area, education, number of workers, age, and number of family dependents used in this study can be

used to predict the effect on farmers' income, while the remaining 15.1% is explained by variables others

athat were not examined in this study. This shows that there are other factors that influence the income of

rice farmers in addition to capital factors, land area, education, number of workers, age, and a number of

family dependents.

1 INTRODUCTION

The contribution of the agricultural sector to

Indonesia's Gross Domestic Product (GDP) and

employment is still very high. Based on BPS's 2010

statistic data the number of Indonesians aged 15

years and over and working in the agricultural sector

is still quite large at 40.28%, while in the industrial

sector 15.96%, trading 22.58% and other sectors

10.53 %. This shows that the agricultural sector is

still the largest sector in absorbing labor in

Indonesia. This is relatively smaller when compared

to developed or industrial countries. In America the

workforce in the agricultural sector is 3%, while in

Japan it is 4.1% (Todaro, 2004). Similar to the

situation in Indonesia, for the province of East Java

with a population of 37,476,757 people (BPS 2010),

the agricultural sector is still the largest sector in

absorbing labor.

The development and modernization of agriculture

in developing countries can contribute to increasing

production, increasing farmers' incomes and

providing markets for industrial sector production,

expanding employment opportunities, increasing

exports and creating savings for development. The

most vulnerable sector in most parts of East Java is

the agricultural sector. One of the regions with the

largest food agricultural production is Malang

Regency, consisting of 33 sub-districts, and has an

area of agricultural land around 14.31 percent

(45,888 hectares) is rice fields, 35.45 percent

(113,664 hectares). Following is a picture of

harvested food crops in Malang Regency, Figure 1.

Figure 1: The extent of Harvesting of Food Crops in

Malang Regency, 2016

(BPS, Kabupaten Malang in Figures 2017)

136

Rachmawati, D., Putri, R., Megasari, R. and Handayani, S.

Income Analysis of Paddy Farmers in Malang District.

DOI: 10.5220/0008784001360142

In Proceedings of the 2nd International Research Conference on Economics and Business (IRCEB 2018), pages 136-142

ISBN: 978-989-758-428-2

If viewed based on BPS data, Donomulyo

Subdistrict is the largest sub-district with rice fields

and fields harvested in Malang Regency, therefore

this study focuses on the sub-district.

Figure 2: Harvest area, productivity, and rice production

(rice fields and fields) based on Districts in Kabupaten

Malang, 2016

(BPS: Kabupaten Malang dalamAngka 2017)

Based on the results of the Population

Registration at the end of the year, the total

population of Donomulyo Subdistrict in 2015 was

62,548 people with a density of 325 people / km2.

Population composition by sex shows that 50.45

percent are male population and 49.55 percent are a

female population with sex ratio rate of 101.81

percent. In the economic structure of Malang

Regency, the Agricultural Sector still has an

important role in economic development. Judging

from its contribution to the formation of Gross

Regional Domestic Product in 2016, this sector

contributed around 30 percent or ranked first. The

absorption capacity of the Agriculture Sector

towards employment opportunities in Malang

Regency is also dominant compared to other sectors.

Figure 3: Area of paddy fields in Donomulyo Subdistrict,

based on Villages (BPS, 2018)

In agriculture, production is obtained through a

process that is quite long and full of risks. The

length of time needed is not the same depending on

the type of commodity being cultivated. Not only

time, but the adequacy of the production factor also

contributes to the achievement of production. In

terms of time, plantation businesses need a longer

period compared to food crops and some

horticultural crops. Each type of plant also has a

periodization that is different from each other.

Agriculture in a narrow sense is defined as the

act of utilizing a plot of land to cultivate certain

types of plants, especially those that are seasonal.

Farming is organizing (managing) assets and ways

in agriculture, or more precisely is the activity of

organizing agricultural production facilities to obtain

results or profits (Daniel, 2002).

There are two terms that need to know the

difference in meaning clearly, one term is "farming"

(farming) and the second is "agriculture"

(agriculture). In subsistence agriculture, the two

terms are synonymous. Every farmer uses his own

land and family labor. He held his own food barn,

provided his own seedlings, water or irrigation,

fertilizer and working equipment, consumed his own

crops, and exchanged some of the harvests with

other materials or goods. Production initiatives are

solely in the hands of individual farmers. The

production is not affected at all by the market or

development plan. A subsistence farmer is an

independent person, who works according to his

own plan, with the ingredients alone managing his

business independently. Subsistence farmers can be

Income Analysis of Paddy Farmers in Malang District

137

equated with craftsmen (Mosher, in

Notohadiprawiro, 2006). If the main objectives of

agricultural development and rural areas in

developing countries are to improve the standard of

living of rural communities through increased

income, total production (output), and productivity

of small farmers, then the governments of

developing countries must first identify the main

source of agricultural progress and basic conditions

that would affect the success of the main goal. All

these important elements are clearly related to each

other so as to form a very complex relationship, but

to facilitate understanding, it can be separated into

three components, namely:

Sources of small-scale agricultural progress:

a. Technological progress and innovation

b. The right government economic policy

c. Supporting social institutions

General requirements for rural progress

a. Modernization of the farm structure in order to

meet the increasing demand for food

b. Creation of an effective support system

c. Changes in rural social conditions to improve the

living standards of rural communities

2 LITERATURE REVIEW

2.1 Capital

According to Mubyarto (1989), farming capital is

goods or money that together factor in the

production of land and labor and produce new

goods, in this case agriculture. Farm capital goods

are important in enhancing the efficiency of

economic growth, in farming capital in the form of

goods are livestock, hoes, plows and other

agricultural equipment, fertilizers, seeds, crops that

have not been sold, plants that are still in the fields

and others.

Capital is a tool to foster income so there is

interest or encouragement to create capital. Capital

is created by farmers by refraining from

consumption with the expectation of greater income.

2.2 Agricultural Land

According to Wirardi (in Susilowati, 2010), land

tenure is an order and procedure that regulates the

rights and obligations of individuals or groups in the

use and supervision of land. Land tenure in

Indonesia has various forms. The status of land

rights stipulated by the LoGA are: (1) Property

rights, (2) Cultivation rights, (3) Right to use

buildings, (4) Usage rights, (5) Rental rights, (6)

Land opening rights, ( 7) Right to collect forest

products, (8) Other rights not included in those

rights that will be determined by law. With the

enactment of the LoGA, several forms of traditional

land tenure have been changed their legal status.

Diverse land tenure status will influence certain

characteristics, including: (1) guarantees for access

to land in the long term, (2) ease of access to credit

institutions, (3) ease of making decisions regarding

land use, (4) guarantees of encroachment from other

parties, (5) guarantees to obtain all production

results on land use, (6) ease of transferring tenure

rights over land to other parties, (7) ease of

participating in group formation, and (8)

convenience government intervention in terms of

extension of credit assistance and direct investment.

(Pakpahan in Susilowati, 2010)

According to Soekartawi (2001), the land area is

the area of land owned by farmers. Until now the

area of land owned by someone reflects the

economic status from a traditional point of view,

especially in rural areas. The wider the land owned

or controlled the higher the economic status.

Siagian (1982) explained that "narrow land

ownership usually presents a problem for farmers,

namely the difficulty of farmers to increase

agricultural production, in addition to the narrow

land that causes the position and life of farmers to

weaken". The extent of land ownership in this case

ownership of land affects the amount of household

income from various sources, this condition means

that farmers with narrow land who do not have land

will be less able to find income outside the

agricultural sector than large land farmers. (Mustofa

and Utaya, 1990)

The results of the agricultural census show that

during the period 1983-1993 there was a change in

the structure of the control of agricultural

households and the most prominent was the

increasing number of smallholders with their

narrowing tenure and on the other hand there was

control of a small number of large-scale farmer

households (Sumaryanto and Rusatra, in Budiman

2011). Inequality in land tenure structures has led to

inequality in income structures, because large land

farmers succeeded in accumulating capital and

expanding businesses in both farming and non-

agricultural businesses.

2.3 Level of Education

In 1993 GBHN explained that national education

rooted in the culture of the Indonesian people and

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138

based on Pancasila and the 1945 Constitution was

directed to improve the intelligence and dignity of

the nation, to realize the people and people of

Indonesia who are faithful and fearful of God

Almighty quality and independent so as to build

themselves and the surrounding community and can

meet national development needs and be responsible

for nation-building.

In the opinion of SadonoSukirno (1994) from the

effects of education, training, and work experience,

productivity will increase, further increasing the

production so that income will increase.

2.4 Labor

Labor in agriculture in Indonesia is divided into

labor in small farms and labor in large farms

namely; plantation, forestry, livestock, and so on. In

small farms, the majority of the workforce comes

from the farmer's own family, although occasionally

paying the hired labor. In agriculture, farmers

besides functioning as laborers and as farmer leaders

(managers), and besides contributing energy,

farmers also regulate the organization of production

as a whole. The farmer decides the problem of

fertilization, land management, and whether or not

to use labor from outside in addition to labor from

his own family. (Mubyarto, 1989)

2.5 Age

Age or age is the period of time in the year starting

from the year of birth. Age is one of the identities

that can affect workability and mindset. In general,

young and healthy farmers have better physical

properties than older farmers, young farmers are also

quicker to accept the recommended things. This is

because young farmers are more willing to take

risks. Young farmers usually lack experience. To

compensate for this shortage, he was more dynamic,

so he quickly gained valuable experiences for the

development of his life in the future. (Adhawati in

Purwanti, 2007).

2.6 Number of Family Dependents

Family dependents are all people who live in one

house or who are outside and are borne by the head

of the family, which includes wives, children and

other family members who take part in the ride. On

the one hand, the large number of family dependents

is a burden for the head of the family to finance all

kinds of needs. The more family members who live

together, the more the cost of living must be spent.

On the other hand, family members are assets for

farmers, namely in the form of labor that can be

utilized in managing farming. Thus the more family

members owned by farmers, the more labor can be

utilized. (Wahap in Purwanti, 2007)

3 METHODS

This type of research is quantitative. The purpose of

this research is to find out the magnitude of the

influence of capital factors, the area of arable land,

level of education, amount of labor used, age, the

number of family dependents on the income of

farmers in Donomulyo Village, Malang Regency.

With multiple linear analysis methods. The data in

this study in the form of primary data and secondary

data whose processing is done through the SPSS 20

for Windows program application. The sampling

procedure is done by simple random sampling,

which is a simple form of probability sampling,

where each sample of the same size has a probability

or equal opportunity to be selected from the

population

1. Register the family of the farmer who owns the

land in the sample village obtained from the

village office.

2. Determine the number of families of farmers

who own land, and obtain 511 families. Of the

511 households, 10% were taken, which would

be used as respondents, namely 51 households.

3. Assign sample respondents using a random

number table.

4 RESULTS

4.1 Capital

Of the 51 respondents selected as a sample, they

issued capital for their farming business, between

Rp. 300,000 - Rp. 3,500,000 each season.

Table 4.5 Distribution of Respondents by Capital

No Capital Res-

pondent

< Rp 1.000.000

Rp 1.000.000– Rp

2.000.000

> Rp 2.000.000

11,77%

29,41%

58,82%

Total 51 100%

Income Analysis of Paddy Farmers in Malang District

139

Based on the table above, 51 respondents, mostly

6 respondents (11,765%) spent less than Rp

1,000,000. While as many as 15 respondents

(29.41%) issued capital starting from IDR 1,000,000

to IDR 2,000,000, and a small portion of 30

respondents (58.82%) spent more than IDR

2,000,000

4.2 Cultivated Land Area

From the results of the study obtained data on the

area of cultivated land of respondents amounting to

varying between 0.13 - 3 hectares.

Table 4.6 Distribution of Respondents by Area of

Cultivated Land

No. land area

(ha)

Respondent %

>0,5

0,5 – 2

9,80%

27,45%

62,74%

Total 51 100%

Based on the table above, 51 respondents, mostly

32 respondents (62.74%) had arable land with an

area of more than 3 ha. While 14 respondents

(27.45%) had arable land with an area between 0.5

ha - 2 ha, while the remaining 5 respondents (9.8%)

had arable land covering an area of 0.5 ha

4.3 Level of Education

Of the 51 respondents who were selected as the

sample, the majority of respondents were of primary

education level. More details about the respondent's

education level are explained in the following table:

Table 4.7 Distribution of Respondents by Education

No. level of education Respondent %

Primary school/

equivalent

Junior school /

equivalent

High school /

equivalent above

21,57%

72,55%

5,88%

Total 51 100%

Based on the results of the study of 51

respondents, most of them were 37 respondents

(72.55%) with junior high school / equivalent

education. While 8 respondents (21.57%) had an

elementary / equivalent education, while the

remaining 3 respondents (5.88%) had a high school /

equivalent education and above.

4.4 Number of Workers Used

Based on the results of the study obtained data on

the number of workers in each respondent's family

ranged from 2 - 9 people. The following table shows

the distribution of respondents according to the

number of workers.

Table 4.8 Distribution of Respondents by Number of

Workers Used

No. Total

manpower

Respondent %

1 – 3

4 – 5

6 – 8

27,45%

64,7%

7,84%

Total 51 100%

Based on the table above, most of the

respondents of farmers in Donomulyo Village use 4-

5 workers to work on their farms. While farmers

who use more than 9 workers are 2 respondents.

4.5 Age

A person's age affects the decision and ability of

physical activity. Physical endurance affects the

absorption of one's work time to work. Of the 51

respondents selected as samples aged between 39-60

years.

Table 4.9 Distribution of Respondents by Age

No. Age

Group

(Year)

Respondent

(Orang)

36 – 54

55 – 60

> 60

31,37%

68,63%

Total 51 100%

From these data it can be seen that more than 1%

of respondents aged between 36 - 54 years are as

many as 16 respondents (31.37), which is associated

with aspects of Human Resources this indicates

productive age. While the remaining 35 respondents

(68.63%) aged 55-60 years.

4.6 Number of Family Dependents

The number of family dependents in this case is the

number of family members who are economically

still dependent on the head of the family. Based on

the results of the research data, the number of family

dependents is in the range of 0-6 people. The

following table shows the distribution of

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respondents according to the number of family

dependents.

Table 4.10 Distribution of Respondents by Number of

Family Dependents

No.

Number of

family

dependents

Respondent %

0 – 3

4 – 5

29,41%

60,78%

9,8%

Total 51 100%

From table data 4.10 it can be seen that as many

as 15 respondents (29.41%) have family dependents

between 0-3 people. While 31 respondents (60.78%)

have family dependents between 4 people - 5 people,

and the remaining 5 respondents (9.8%) have a

family burden of more than 5 people.

4.7 Income

Revenues from farms referred to in the study is

income received by households from farming

activities. From the results of the study, it was

obtained data that most of the income from farming

ranged between Rp. 1,000,000 - Rp. 14,000,000.

More details about the income of respondents can be

seen in the following table:

Table 4.11 Distribution of Respondents by Revenue

No. Income

(Rp)

Respo

ndent

1.000.000 - 2.000.000

2.500.000 - 5.000.000

5.000.000 - 7.500.000

> 7.500.000

11,765%

17,65%

50,98%

19,61%

Total 51 100%

Of the 51 respondents of farmers in Donomulyo

Village, the amount of income earned by farmers

was between Rp.1,000,000 - Rp.2,000,000, which

was 6 respondents (11.765%). While farmers who

earn more than Rp 7,500,000 are only 10

respondents (19.61%).

5 DISCUSSION

The results of this study are in accordance with the

results of previous studies by Budiman.R.S. (2007)

entitled "Analysis of Factors Affecting Farmer

Income and Income Distribution of Farmers in

RambaiKaca Village, PajarBulan District, Lahat

Regency, South Sumatra", which shows that capital

has a significant influence on farmers' income.

Meanwhile, according to Mubyarto (1989),

farming capital is goods or money that together

factor in the production of land and labor and

produce new goods, in this case agriculture. Farm

capital goods are important in enhancing the

efficiency of economic growth, in farming capital in

the form of goods are livestock, hoes, plows and

other agricultural equipment, fertilizers, seeds, crops

that have not been sold, plants that are still in the

fields and others. Capital is a tool to foster income

so there is interest or encouragement to create

capital.

Based on the research and some of these

opinions about the influence of capital on the level

of income, the capital indeed greatly influences the

amount of income for farmers because capital is one

of the factors of production from agriculture. If

farmers who have high capital, the income will be

greater than the farmers who have low capital,

because with high capital farmers can run large

amounts of farming so that it is possible to get

income from larger crops.

Purwanti (2002), entitled "Revenue of the Sub

Das Malino Farmers of Gantarang Village, Gowa

Regency", which shows that the higher level of

education can increase farmers' income (positive

influence).Whereas according to SadonoSukirno

(1994) from the effects of education, training, and

work experience, productivity will increase, then it

will cause additional production so that income will

increase. The level of education indeed greatly

affects the amount of income for farmers because

education is one of the factors of production from

agriculture. If the farmer has a high level of

education, the income will be greater than the

farmers who have a low level of education, with a

high level of education, farmers can run a farm or

plant rice with the theory and knowledge they have

so that it is possible to earn income from crops the

greater one.

Research conducted by Safaruddin, M. Shawwal

and Muhammad Arsyad (2010) entitled

"Contribution of Extension to Production Increases

and Rice Farmer Income in North Luwu District",

which shows that the variable number of family

dependents contributes positively to rice farmers.

From the results of the research and various

opinions about the effect of the number of family

dependents on the level of income, the number of

family dependents affects the amount of income for

farmers because if farmers have a large number of

family dependents, it will reduce their income more

Income Analysis of Paddy Farmers in Malang District

141

than farmers who have a small number of family

dependents.

Simultaneously, capital, land area, education,

number of workers, age, and family dependents

significantly affect the income of rice farmers. From

the results of the analysis it is known that 85.9% of

the variables of capital, land area, education, number

of workers, age, and family dependents used in this

study can be used to predict the effect on farmers'

income. While the remaining 15.1% is explained by

other variables not examined in this study. This

shows that there are other factors that influence the

income of rice farmers in addition to capital factors,

land area, education, number of workers, age, and

family dependents.

6 CONCLUSION

The higher the capital, the higher the income of

farmers. So the capital positively significantly

affects the income of rice farmers in Donomulyo

Village.

Positive significantly the area of cultivated land

affects the income of rice farmers. With large arable

land, the income of rice farmers is also high.

Education level positively significantly affects

the income of rice farmers. With the increasingly

high level of education, productivity will increase,

further increasing the production so that income will

increase.

The amount of labor used is the higher the

income of rice farmers, because they use their family

members as laborers. So that the number of workers

influences the income of farmers in the village of

Donomulyo.

The older the farmer is, the greater the income.

This is because older farmers have more experience

in farming. So that the age factor also affects the

income of farmers.

The number of family dependents does not have

a significant effect on farmers' income. Because the

number of family dependents or family members is a

burden for farmers, namely by increasing the

number of family dependents can reduce the level of

income of farmers. Thus the more family members

owned by farmers, the lower the income of farmers.

7 RECOMMENDATION

To improve the welfare of farmers, especially rice

farmers, the regional government needs cooperation

with various parties, such as academics,

practitioners, the ministry of agriculture.

Agricultural development planning, especially food

crop agriculture (paddy) requires long-term planning

involving these various crops. From the conclusions

in this study, the capital and education level of the

farmers is still very low so it needs to increase the

capital. Both of these are important factors in

increasing income, besides regeneration in this

sector is still very low. Agricultural technology,

which is of course very much needed to increase

productivity and income, must be applied and of

course requires planning and collaboration of several

parties.

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