JAKARTA: The government has appealed to the private sector to create more jobs and relax requirements for entry-level positions as the labour market grapples with an annual influx of approximately 1.5 million new graduates.
Speaking at the national leadership meeting of the Indonesian Chamber of Commerce and Industry (Kadin) on Monday, Coordinating Economy Minister Airlangga Hartarto highlighted the critical bottleneck, saying that rigid criteria for prior experience effectively barred fresh graduates from entry.
“When you advertise a job, you write one year or two years of experience, so those who want to enter the workforce are rejected first,” he said.
The open unemployment rate eased to 4.85% in August from 4.91% a year earlier, yet the jobless population remained a substantial 7.46 million, according to Statistics Indonesia (BPS) data.
The August rate also marked a reversal from the latest low of 4.76% recorded in February, when 7.28 million people were unemployed.
Airlangga urged Kadin to respond actively by “accepting the best students, including Gen Z, and giving them the opportunity to work”.
Data from the Investment and Downstream Ministry showed that realised investment as of September had reached 1.43 quadrillion rupiah of the 1.9 quadrillion rupiah full-year target.
While the capital expenditure reportedly produced some 1.95 million jobs, this has yet to address the larger problem of unemployment and job scarcity remains significant.
The working-age population grew by 2.8 million to 218.17 million in August, BPS data showed, but the labour market has failed to expand to keep pace with this demographic growth.
The inactive population, which includes students and homemakers, rose by 910,000 to 64.17 million in August.
During that month, the labour force, which comprises people who are currently employed as well as unemployed people seeking jobs, grew by 1.89 million to 154 million.
The employed segment increased by 1.90 million to 146.54 million while the unemployed segment remained largely unchanged with a marginal decline of 4,000 to 7.46 million.
In a bid to tackle youth unemployment, the government recently added 100,000 spots to a subsidised internship scheme.
It is a programme that aims to create a direct pathway from academia to employment.
Offered under a joint public and private partnerships, the six-month internship programme provides compensation based on the local minimum wage and is set to double in scale next year with another 100,000 spots.
Nearly one in three Indonesians belong to the largest jobless group of long-term unemployed, referring to people who have been seeking work for more than a year.
Closely behind at 31% are people with previous work experience, who are currently unemployed.
Some 58,000 people were laid off between February and August, though that statistic reflected only formal workers and did not include layoffs in the informal sector.
Of the total figure, the manufacturing industry was responsible for 22,800 layoffs, or almost 40%, though it also recorded a strong net gain of around 700,000 new hires over the same period.
Meanwhile, the mining and related trade sectors together accounted for just over 17,000 job losses, or around 29% of the eight-month total, and the agriculture and related trade sectors shed nearly one million workers combined. — The Jakarta Post/ANN
