Indonesia Labour Market Outlook 2016

Indonesia should focus on employment-friendly growth

A relatively large young population and abundant natural resources, Indonesia can realize its demographic dividend. However, for that to happen the country needs to create economic opportunities and invest in human resources thereby enabling more people to engage in productive and decent employment.

News | Jakarta, Indonesia | 19 September 2016
An interactive talkshow on Indonesia Labour Market Outlook, 2016
A relatively large young population and abundant natural resources, Indonesia can realize its demographic dividend. However, for that to happen the country needs to create economic opportunities and invest in human resources thereby enabling more people to engage in productive and decent employment.

These were some of the key conclusions of an interactive radio talkshow on 15 September 2016 titled “Quality of Indonesian Workers: Who is Responsible?” The talkshow was organized by Sonora Radio, a leading radio network in Jakarta, and the International Labour Organization (ILO). During the talkshow, ILO also presented the latest edition of the Indonesia Labour Market Outlook, 2016.

Many of the provincial governments are still not focusing so much on job opportunities. They should actively work with the private sector and giving incentives to companies to absorb more job seekers."

Aviliani, a well-known Economist in Indonesia
Besides radio audiences, more than 50 participants attened the talkshow. Various economic and employment issues were discussed, including patterns of growth, high youth unemployment, gender gap, and skills development.

Owais Parray, the ILO's Economist
“We are witnessing a synchronized slowdown of major economies, but Indonesia can do more to tap its vast potential. Indonesia needs to harness growth and employment at the higher-end of the manufacturing and services sector,” said Owais Parray, ILO Economist.

Aviliani, Indonesian Economist
Aviliani, a well-known Economist in Indonesia, highlighted that the demography of Indonesia with a high number of young people can be an advantage for the country. Unfortunately, the governments at the sub-national level are not giving much attention to employment.


“Many of the provincial governments are still not focusing so much on job opportunities. They should actively work with the private sector and giving incentives to companies to absorb more job seekers,” she said.
Harijanto, Chair of the Indonesian Employers’ Association (Apindo)


Meanwhile, Harijanto, Chair of the Indonesian Employers’ Association (Apindo), emphasized the importance of skilled and qualified workers needed by the companies.

We are working closely with the Indonesian Chamber of Commerce (Kadin) and Apindo to organize apprenticeship programmes involving over 2,000 companies. We are also focusing on vocational training for both job seekers and workers."

Sugiharto Sumas, Head of Research and Development of the Ministry of Manpower
“It is still difficult to find qualified workers at the managerial level. As a result, companies end up hiring foreign workers. Therefore, in the future, we should improve our vocational education training and also make it easier for companies to get investment permits,” he said.

Sugiharto Sumas, Head of Research and Development of the Ministry of Manpower
Responding to Harijanto, Sugiharto Sumas, Head of Research and Development of the Ministry of Manpower, explained that starting this year, the Government of Indonesia has applied a demand-supply approach in an effort to address unemployment and productivity of workers.

“We are working closely with the Indonesian Chamber of Commerce (Kadin) and Apindo to organize apprenticeship programmes involving over 2,000 companies. We are also focusing on vocational training for both job seekers and workers,” he underlined.

In his concluding remarks, Francesco d’Ovidido, Country Director of ILO in Jakarta, reiterated that “ILO stands ready to facilitate and support its constituents such as the government, employers and workers to enact pro-employment policies and programmes not only at the national level, but also at the regional level. Indonesia is a vast country and that is why development efforts should focus both at the national and sub-national level”.