Airlangga Said He Would Call The Labor Intensive Industry Regarding Wages

Coordinating Minister for Economic Affairs (Menko) Airlangga Hartarto. (Photo: Doc. ANTARA)

JAKARTA - Coordinating Minister for Economic Affairs Airlangga Hartarto opened his voice regarding wages that are not comparable to the increase in living expenses amidst global uncertainty.

He said that the remuneration or salary policy is the authority of each company and depends on the industrial situation it faces.

"Tomorrow I will call the labor-intensive industry," he told the media crew, April 29.

Regarding the World Bank report which states that 60.3 percent of Indonesia's population is still poor, Airlangga explained that the government has its own standards in determining the poverty line.

"The government has a standard number, right, there will be more reviews," he explained.

Previously, in the latest April 10, 2025 edition of the Macro Poverty Outlook report from the World Bank, it was revealed that around 60.3 percent of Indonesia's population in 2024 was categorized as poor if they used the poverty line standard for middle and upper income countries.

According to the World Bank, recording the number of Indonesians reaching 285.1 million people means 60.3 percent or around 171.9 million people are categorized as poor.

In this context, the poverty threshold is determined at a minimum expenditure rate of 6.85 US dollars per day per person, or equivalent to around IDR 115,000 per day, assuming an exchange rate of IDR 16,780 per US dollar.

As for countries in ASEAN, this figure places Indonesia as the country with the second-highest poverty rate in Southeast Asia, after Laos recorded a figure of 68.9 percent.

When compared to other ASEAN countries, the poverty rate in Indonesia is much higher where Malaysia only recorded 1.3 percent, Thailand 7.1 percent, Vietnam 18.2 percent, and the Philippines 50.6 percent. Meanwhile, data from Brunei Darussalam, Cambodia, and Myanmar are not available in this report.

However, the World Bank projects a reduction in poverty in Indonesia in the next few years where the percentage of the poor will decrease to 58.7 percent in 2025, then 57.2 percent in 2026, and 55.5 percent in 2027.

Meanwhile, this projection can be achieved if Indonesia's economic growth is able to penetrate a minimum figure of 6 percent per year.

Furthermore, the World Bank stated that Indonesia is targeting to become a high-income country by 2045.

To achieve this goal, the government targets 8 percent by 2029 through higher investment. While strong demand has supported stable economic performance and reduced poverty, accelerating growth requires the implementation of structural reforms to increase the country's growth potential and reduce the risk of overheating," the report said.

On the other hand, if you use the poverty line standard for lower middle income countries, namely spending of US$3.65 per day or around Rp. 61,249 per day assuming a shortage of Rp. 16,780 per US dollar.

Where Indonesia's poverty rate in 2024 is far lower, namely 16.6 percent or around 44.4 million people. This figure is also expected to fall gradually to 11.5 percent by 2027.