JAKARTA: The Indonesian Employers Association (Apindo) has called on the government to focus on resolving structural bottlenecks affecting businesses, arguing that preventing layoffs requires improving the investment climate rather than addressing labour issues only after workers lose their jobs.
Apindo chairwoman Shinta Kamdani said Indonesia’s economic resilience depends on its ability to address longstanding challenges faced by the real sector amid an increasingly uncertain global environment.
She said businesses were contending with geopolitical tensions, shifts in global trade policies, supply chain disruptions, as well as volatile energy and commodity prices.
Shinta added that they were also facing domestic obstacles such as high production and logistics costs, expensive energy, regulatory inefficiencies and weak labor productivity.
According to Shinta, these structural problems have undermined investment, production and job creation, making them the root cause of rising layoffs.
“If we truly want to prevent layoffs, we cannot only debate downstream issues. We must fix the upstream problems,” she said in Makassar, South Sulawesi, on Tuesday.
Shinta added that every unresolved business obstacle weakens the multiplier effect needed to attract investment, expand production and create employment.
Apindo also highlighted broader labor market challenges, noting that around 67% of Indonesia’s unemployed are young people, predominantly from Gen Z, while nearly 60% of the workforce remained employed in the informal sector, highlighting the need not only to generate jobs but also to create productive, quality and sustainable employment.
To help address business constraints, Apindo has established a Task Force on Debottlenecking Business Obstacles, an internal mechanism designed to identify, monitor and push for the resolution of issues affecting companies.
Last week, Apindo’s labuor affairs chief Bob Azam said the association was pushing for the upcoming Manpower Law to serve as a forward-looking framework rather than merely responding to a recent Constitutional Court ruling.
He said the legislation should focus on creating more jobs through a conducive investment climate, fostering fair and harmonious industrial relations.
Bob added that there was a need to improve the productivity and competitiveness of Indonesia’s workforce to strengthen Indonesia’s overall employment ecosystem so it remained competitive with other Asean countries and continues to attract investment.
He said that the association has engaged extensively with labour unions, ministries, lawmakers, the National Economic Council and research institutions to formulate 10 measures to mitigate layoffs.
He added that they also wanted to ensure the new law was equipped to respond to emerging challenges such as artificial intelligence, green jobs and the development of higher value-added industries. — The Jakarta Post/ANN
