ILO-TEMPO Interactive Discussion: From Unemployed to Get Back to Work, What can Unemployment Insurance Do?

The discussion aims to raise the awareness of the policy makers, industrial associations, workers’ organizations and relevant stakeholders regarding the implementation of social insurance and its link to the public employment service to protect both workers and employers.

Indonesia’s social protection system is still evolving. Since its amendment in 2002, the Indonesian Constitution recognizes the right of all people to social security, and the responsibility of the State in the development of social security. The National Social Security Law follows a staircase approach with non-contributory schemes for the poorest people, contributory schemes (with nominal and subsidized contributions) for the self-employed and informal economy workers, and statutory social security schemes (with contributions set at a percentage of wages) for formal sector workers and their dependents.

In 2014, social security schemes managed by four State-owned companies were consolidated to two public social security administering bodies: BPJS Kesehatan (Health) and BPJS Ketenagakerjaan (Employment). The new BPJS Ketenagakerjaan (Employment) was launched in 2015. In 2020, following further social security reform, a new Employment Insurance scheme was adopted and it is currently in the process of being rolled out by the national social security institution. In light of this new development, the time is right for consolidating the government of Indonesia’s efforts towards building a more comprehensive national social protection system.

However, in the current mechanisms, unemployed workers are not effectively protected in case of job loss. Without an employment insurance provision, statutory severance pay and lump-sum withdrawal of old-age saving are their main source of income replacement against unemployment. However, these schemes are not designed to guarantee an adequate level of benefit; and in particular case of insolvencies, the employers’ liability scheme often becomes less reliable to protect unemployed workers. Public employment services and re-training programmes are also expected to play an important role to protect unemployed workers by promoting reemployment and shifting workers from a declining sector to emerging one.


Anwar Sanusi, Secretary General of the Ministry of Manpower

Roswita Nilakurnia, Director of Service of BP Jamsostek

Bambang Shergi Laksmono, Social Policy Professor of the Faculty of Social and Politics, University of Indonesia

Kazutoshi Chatani, Employment Specialist of the ILO

Wahyu Dhyatmika, Director of PT Info Media Digital.