Analysis of the Effect of Exchange Rates, Labor Force Participation Rate, and Regency Minimum Wage on Foreign Direct Investment in Gresik Regency

Gresik Regency is one of Indonesia’s strategic regions for foreign direct investment (FDI), supported by its geographic advantages and the development of the integrated industrial zone Java Integrated Industrial and Port Estate (JIIPE). This study examines the effect of exchange rates, labor force participation rates, and regency minimum wages on FDI realization in Gresik during 2008–2023 using multiple linear regression with time-series data. The findings reveal that exchange rates and regency minimum wages significantly affect FDI, while the labor force participation rate shows no significant influence. These results indicate that foreign investors prioritize macroeconomic stability, human resource quality, and infrastructure availability. Strengthening macroeconomic stability and improving human capital are therefore crucial to enhancing FDI inflows into the region.