Reinforcing the role of decent work in equitable growth a core priority, Says New ILO Report

JAKARTA (ILO News): Indonesia recorded an increase in the unemployment rate as a result of slower economic growth in 2013, with unemployment reaching 6.25 percent in August 2013. This increase in unemployment stands in contrast to the longer-term trend of decreasing unemployment. Between August 2012 and August 2013 employment growth dropped to zero while the economy grew at around 5 per cent, reflecting an issue of stagnation and jobless-growth. Employment in manufacturing, which provides important information on trade and investment trends, has experienced a decline for the first time in five years. The labour force participation rate also declined. These trends indicate that there are some serious employment related concerns emerging in the economy.

"Employment is one of the most important issues in developing the Indonesian economy. However, the low ratio of job creation to economic growth continues to be a key concern,” said Peter van Rooij, Director of the ILO in Indonesia. He further explains that, “Further efforts are needed to ensure that the Government’s pro-jobs, pro-poor, pro-environment and pro-growth development policy realises its job-rich growth objective. This means that the same efforts that go into the promotion of economic growth and poverty reduction need to go into employment promotion."

The report, "Labour and Social Trends in Indonesia 2013: Reinforcing the role of decent work in equitable growth," highlights that Indonesia has faced adjustments in its macroeconomic indicators in 2013, and these adjustments have been reflected in a decline in the employment situation. While there has been progress on selected indicators, such as educational attainment and formal employment, challenges remain, particularly on labour productivity, access to social protection and wages. Therefore, this year the report's message is about maintaining the gains that have been made in the world of work, while at the same time reinforcing the role of decent work in equitable growth.

The report analyses selected indicators that provide insight on employment quantity and quality in Indonesia. "With the slowing of economic growth, Indonesia is now facing a situation of jobless growth. Income inequality has also been on the rise, despite the strong labour force participation of poor households. The situation highlights an urgent need to focus on decent work and equitable growth," said the author of the report, Emma Allen, economist for the ILO Jakarta Office.

The report will be launched and released on Tuesday the 17th of December, in the Hotel Kempinski, Jakarta, from 12.00 – 16.00. For the main findings of the report, please refer to the attached ‘Key points: Labour and Social Trends report for Indonesia’.

For further information please contact:
Gita Lingga
ILO's Communications Officer
Tel.: +6221 391 3112 ext. 115
Email