Pandemic Impact, 6 Million Workers Unemployed, Household Consumption Destroyed

Illustrated. (Achmad Basarrudin / YOU)

JAKARTA - The Indonesian Employers' Association (Apindo) stated that the pressure that the COVID-19 pandemic has put on the business world has had a negative impact on the workforce. To date, 6 million workers have been laid off.

Apindo Deputy Chairperson Shinta Kamdani said that this figure was the latest data held by the association. This figure is higher, when compared to data from the Ministry of Manpower, which amounted to 2.67 million people.

"The number continues to rise, association data that 6 million people have been sent home," he said in a virtual discussion, Thursday, November 26.

This situation, said Shinta, had a negative impact on the economy as a whole. This is because workers who are sent home usually do not get a salary. This makes the consumption of society as a whole decrease. Meanwhile, household consumption is one of the main drivers of economic growth.

Shinta said, if Indonesia wants to recover, the government must at least create more than 3 million jobs. This will restore the purchasing power of public consumption.

This new job opportunity, said Shinta, could stimulate the level of purchasing power of household consumption from the domestic market.

"Indonesia must at least create more than 3 million jobs to restore people's purchasing power to pre-pandemic levels," he said.

Shinta said that the slowdown in the national economy during the crisis due to the COVID-19 pandemic was caused by the decline in household consumption demand. One of them is due to the decline in purchasing power after many workers have been affected by layoffs (PHK).

"In fact, domestic consumption is the driver of the national economy so that it can recover to pre-pandemic levels," he said.

Therefore, Shinta said, his party asked the government to immediately provide new jobs to stimulate the level of people's purchasing power. This is believed to be able to break the negative trend of Indonesia's economic growth which has been going on for two consecutive quarters this year.

"Indeed, absorbing workers is very hard. But this is so that the national economy can recover to pre-COVID-19 levels," he said.

Previously, the Minister of Manpower, Ida Fauziyah, said the COVID-19 pandemic had a significant impact on the economy and employment. Where, there are 29.12 million working age population affected by the COVID-19 pandemic.

The details, unemployment due to the COVID-19 pandemic amounted to 2.56 million people, not the workforce due to the COVID-19 pandemic of 0.76 million people. Then, they did not work because of the COVID-19 pandemic by 1.77 million people, and those who worked with reduced working hours were 24.03 million people.

The pandemic which occurred for approximately 8 months, has caused an increase in the number of unemployed to 9.7 million people with an open unemployment rate (TPT) reaching 7.07 percent in Indonesia.