The Decreased Indonesian Manufacturing PMI Potentially Increases Layoffs, This Is The Minister Of Manpower's Response

JAKARTA - Minister of Manpower (Menaker) Yassierli responded to the potential for termination of employment (PHK) in the manufacturing industry sector, following the decline in Indonesia's Manufacturing Purchasing Managers' Index (PMI) in June 2025.

In a report released by S&P Global, it was recorded that Indonesia's Manufacturing PMI was 46.9 in June 2025, down from 47.4 in May 2025, and was below the 50.0 neutral threshold.

First, we see this layoff as a work from upstream to downstream. (Mitigation) What is clear now is that JKP (Job Loss Guarantee), which anticipates from the start, the benefits of which we enlarge," said the Minister of Manpower quoting Antara.

In addition, Yassierli also said that the Employment Termination Task Force (Satgas LAYOFFS) is also expected to overcome this problem.

"Secondly, the layoffs Task Force, which we hope will be launched soon. However, part of the layoff task force is now being carried out by the Ministry of Manpower," he said.

When there is an early warning system, that there will be layoffs, (Kemnaker) goes down. Then we monitor it to the service, we have a coordination meeting with the service. Then we are related to mitigating the risks, there is mediation. We do all that," he also said.

The S&P Global report noted that PMI is below 50 showing activities in the contraction zone, not expansion. Since April, Indonesia's manufacturing PMI score has always been below 50.

The decline in orders has reduced production and affected labor and raw materials.

When asked about the need or absence of government intervention in boosting people's purchasing power so that the impact of the potential wave of layoffs can be anticipated, the Minister of Manpower said that the Wage Subsidy Assistance (BSU) that has been distributed recently is one example of this incentive.

However, he emphasized that the evaluation of the implementation of BSU as an anticipatory step is still needed.

"Later we will evaluate it, I'm sure this will not only be from the Ministry of Manpower, with the Coordinating Ministry for the Economy it will definitely be a concern," said Minister of Manpower Yassierli.

"Yesterday BSU was for June and July. We'll see later. That means that from there there is a process, there is a policy, then there is an implementation, there is an evaluation," he added.