In Addition To Rejecting The Job Creation Act, Labor Also Demands An 8 Percent Wage Increase

Labor demonstration to reject the Job Creation Law, Thursday, October 8. (Irfan Meidianto / VOI)

JAKARTA - Labor circles are still asking for an increase in the provincial minimum wage (UMP) of at least 8 percent for the year 2021. This is necessary so that people's purchasing power can be maintained.

The President of the Confederation of Indonesian Workers Unions (KSPI) Said Iqbal said that the ideal wage increase is still the same as in previous years.

"Where the 8 percent increase is equivalent to an increase in the minimum wage in the last three years. Although economic growth has contracted minus in the last 2 quarters, people's purchasing power must be maintained," he said, in a written statement received by VOI, Thursday, October 8th.

Saiq Iqbal said that even though there was inflation, the price of goods was still affordable with a reasonable increase in wages. The increase in minimum wages is also an effort to carry out economic recovery.

"In a situation like now, exports cannot be expected. Therefore, to keep the economic recovery going, what must be done is to increase the value of consumption by increasing the increase in the minimum wage in 2021," he said.

Reflecting on 1998 and 1999

Head of the Communication and Media Department, Kahar S Cahyono, said that basically the request for a wage increase reflected on the situation that occurred in 1998. At that time, there was a crisis due to inflation, even minus economic growth. But in 1998 the minimum wage continued to rise.

"Likewise in 1999, although economic growth was minus, there was an increase," he said.

According to Kahar, the increase in wages will be in line with the increase in economic growth. This can be seen when the government disbursed funds for wage subsidy assistance (BSU) of Rp.600,000 for employees registered with BPJS Ketenagakerjaan.

On the other hand, Kahar rejected the employer's suggestion that there was no need for an increase in the UMP next year. This will only complicate the conditions of workers who are currently gripped by the COVID-19 pandemic.

For your information, employers have argued that the proposed minimum wage will not increase in 2021 due to the conditions of the COVID-19 pandemic and the minuscule Indonesian economy in the middle of a recession.

"Refuse if there is no increase. Because we reflect in 1998, when economic growth was minus big there was still an increase. Even this year, when it was said that economic growth was minus, it is important to ensure that wages continue to increase," he explained.

In addition, Kahar said, if the wage increase approved by the government does not reach 8 percent, his party will continue to seek the increase in this figure.

"The attitude of the KSPI is still there. Why 8 percent? An increase for 3 consecutive years. Back then using PP 78 of 2015 in the range of 8 percent. So to ensure the purchasing power of workers, and maintain such an increase," he said.

Previously, the Minister of Manpower Ida Fauziyah had said that it was difficult to accommodate workers' demands if they had to raise wages like in previous years.

However, Ida said, there might be an adjustment regarding the calculation of the 2021 UMP increase, because the 2020 economic conditions were minus due to the COVID-19 pandemic.

"We know that due to this pandemic economic growth is minus, I think it is impossible for us to set it normally as in PP (78) and legislation. If we force to follow PP 78 and surely many companies will not be able to pay the UMP. Constraints on UMP 2020, but surely we will listen once again in the national context, "said Ida.