Arnoldus Kristianus, Jakarta – The Indonesian government is ramping up efforts to address a spike in layoffs, with Labor Minister Yassierli announcing nearly 60,000 workers affected nationwide as of October 2024 – a rise of 25,000 in just the past three months.

"As of October 2024, 59,796 workers have been laid off, marking a significant increase of 25,000 workers in the past three months," Yassierli said Thursday, highlighting the urgency of coordinated government action.

In an effort to curb further layoffs, Yassierli urged all regions to establish an early warning system to detect potential job cuts in local companies. "The early warning system aims to mitigate the social and economic impact caused by the high number of layoffs," he explained.

Yassierli also emphasized the importance of timely minimum wage adjustments. He called on governors to finalize the Provincial Minimum Wage (UMP) by Nov. 21, 2024, with district and city minimum wage (UMK) adjustments to follow by Nov. 30, 2024. The wage-setting process should consider recommendations from the Wage Council and guidelines based on Statistics Indonesia (BPS) data.

"We all want the 2025 minimum wage setting to proceed smoothly," Yassierli added. "The Ministry of Home Affairs and I encourage all parties, both central and regional, to prioritize communication and social dialogue with all labor stakeholders."

Labor unions have called for a 10 percent wage increase in 2025, but Indonesian Employers Association (Apindo) Chairwoman Shinta Kamdani highlighted the difficulty of applying a uniform wage hike across regions.

"Standardizing wage increases nationwide isn't practical," she said at a Wednesday press conference held at the Coordinating Ministry for Economic Affairs. "Each province, district, and city has its own wage-setting formula, and we urge adherence to the government-established formula."

Under Government Regulation No. 51 of 2023, minimum wage increases are to be calculated based on a formula that includes inflation, economic growth, and an index coefficient between 0.1 and 0.3.

In his State of the Nation Address in August, former President Joko Widodo outlined the government's objective to reduce the open unemployment rate to 4.5-5 percent by 2025, down from the current 4.8 percent, and to lower the poverty rate to 7-8 percent from 9.03 percent.

According to the Central Statistics Agency (BPS), youth aged 15-24 remain the most affected, with an unemployment rate of 16.42 percent, while those aged 25-59 experience a lower rate of 3.08 percent.

Source: https://jakartaglobe.id/business/indonesia-steps-up-efforts-to-curb-layoffs-as-job-losses-near-6000