Workers Demand Provincial Minimum Wage Up 15 Percent, This Is What Entrepreneurs Say

JAKARTA - The Confederation of Indonesian Trade Unions (KSPI) and the Labor Party wants the provincial minimum wage (UMP) and the district/city minimum wage (UMK) in 2024 to increase by 10 to 15 percent in accordance with the field survey on Decent Living Needs (KHL).

Responding to this, Chairman of the Indonesian Employers' Association (Apindo) Shinta W Kamdani said entrepreneurs were still obedient in the rules for calculating wages according to Law (UU) Number 6 of 2023 concerning Job Creation.

"So we follow the formula for increasing wages that has been determined by the government, because we must respect that which concerns inflation with economic growth. We must respect that," he said in Jakarta, written Tuesday, August 1.

Shinta said that the current state of entrepreneurs is also not easy in dealing with economic uncertainty.

So, he continued, his party will continue to follow the calculations from the government if there is an increase in wages.

"Of course things are not easy with the current conditions, but we see what the calculations are like. Because each region is different, provinces and districts/cities are different and cannot be equated. There is no one national one," he explained.

He added that Indonesia's economic condition could be seen from the declining export performance.

Therefore, labor-intensive entrepreneurs will face problems if workers ask for a high wage increase.

"For example, in the labor-intensive sector, exports are labor-intensive again. Especially textiles, yes, they must have problems asking for a high increase," he said.

Even so, Shinta said, the UMP is not only one factor to pay attention to the welfare of workers as a whole, but can be done through cooperation and training.

"We must see how the cooperation with the labor confederation is, in terms of what partnership we build, training in terms of development, maybe workers lose a lot of work, maybe MSMEs and others," he said.