Qualitative Review and Prospects for Economic Growth of MSMEs at the University of Indonesia

This study investigates the factors that influence the financial performance of Micro, Small, and Medium Enterprises (MSMEs) in Indonesia and how they impact the country's economic growth. Researchers collected data through surveys or interviews and then performed statistical analysis, including regression and correlation methods, to establish relationships between various independent and dependent variables. The findings reveal that the quality of entrepreneurship, such as motivation, entrepreneurial orientation, and risk-taking behavior, exerts a positive influence on the financial performance of MSMEs. MSMEs that manage their working capital optimally tend to experience increased profitability and growth, even in the face of operational difficulties like workforce shortages. MSMEs engaged in foreign trade typically achieve higher profitability. Bank loans can boost profitability and sales, but the requirement for collateral can impede growth. The owner's involvement doesn't influence growth but can enhance profitability. Factors like the Human Resources Index, ethnic group interest, the Rupiah exchange rate, and infla-tion don't significantly impact MSME investment. However, the employment power of business units, investment, and exports of MSMEs significantly drive the growth of the Indonesian economy. The correlation analysis highlights that MSMEs serve a crucial role in job creation, rural development, economic diversification, and GDP contribution in Indonesia. Despite facing challenges, they possess the potential for sustainable growth. This study also delves into strategies to surmount the challenges MSMEs encounter and examines the role of higher education in bolstering the MSME sector. The University of Indonesia (UI) lends its support to the MSME sector through various strategies, including education, training, mentoring, and internship programs. This research imparts valuable knowledge about the operations of MSMEs in Indonesia and their contribution to the economy, underscoring areas that warrant further exploration and potential strategies to foster growth and innovation efforts.