Regarding Job Creation Perppu, Apindo Highlights Wage And Power Issues

Chairman of the Indonesian Employers' Association (Apindo) Hariyadi Sukamdani. (Photo: Theresia Agatha/VOI)

JAKARTA - President Joko Widodo has issued Government Regulation in Lieu of Law (Perppu) Number 2 of 2022 concerning Job Creation in lieu of the Job Creation Act, on Friday, December 30.

Responding to this Job Creation Perppu, the Indonesian Employers' Association (Apindo) highlighted two issues in the employment cluster that have changed in it.

The two issues that have changed from the rules in the Job Creation Law, namely the matter of wages and power transfer.

"Well, in wages there was a change that was previously for the calculation of the minimum wage based on inflation or economic growth, one of the highest, so in this Perppu three parameters were taken, namely inflation, economic growth, and certain indexes," said Apindo Chairman Hariyadi Sukamdani at a press conference in Jakarta, Tuesday, January 3.

Hariyadi said that later it was feared that the determination of the minimum wage based on the three parameters would not be the radius of social safety as it should be.

"If this does not reflect the social safety finger and later the increase tends to be like before in PP Number 78 of 2015, what we are worried about is the further between supply and demand," he said.

He also said that the increase in the minimum wage with a new formulation in Perppu would provide a big gap between supply and labor demand.

"So, the supply of workforce is progressing very high, because the current average is around three million per year, there is a new workforce, while the absorption of the workforce or provision of the workforce is shrinking," explained Hariyadi.

According to him, if this trend is not changed, the new workforce will find it difficult to find new jobs, as well as workers who are in the informal sector will also find it increasingly difficult to enter the formal sector.

Meanwhile, regarding the issue of power transfer, Apindo highlighted the issue of restrictions that are actually counterproductive to Indonesia's conditions and efforts in utilizing demographic bonuses.

"If it's a power transfer, in our view it's also not right in this Perppu, because I said earlier that Indonesia needs a very large job field. Well, if all these efforts or corridors are narrowed down, then we don't have many alternatives to provide jobs," he explained.

Haryadi added that his party was surprised by the control of Perppu because entrepreneurs as investors and employers were not involved in it.

For Haryadi, business actors as one of the stakeholders should be able to be involved, even though the business world understands this is done to ensure certainty of business.

"Indeed, all discussions should involve stakeholders, especially those directly related. This is, right, funny, we gave the job, we gave the salary, but were not invited to talk. It's also funny to suddenly break up," he concluded.