Employers say no to further wage hike<\/p>\n
A'an Suryana, The Jakarta Post, Jakarta<\/p>\n
Employers remain committed to implementing a 7 percent increase
\nin the minimum labor wage despite a simultaneous utility price
\nhike, said an industry leader.<\/p>\n
However, employers would not be able to bear another round of
\nwage increases amid soaring production costs, said Sofyan
\nWanandi, chairman of the National Economic Recovery Committee
\n(KPEN), an influential grouping of employers.<\/p>\n
\"Worker wages have been raised by 100 percent during the past
\nthree years. We are unable to shoulder more of a burden; enough
\nis enough,\" Sofyan said on Friday.<\/p>\n
The government raised fuel prices, and electricity and
\ntelephone rates earlier this week as part of efforts to reduce
\nexpensive subsidies and help prevent state utilities from going
\nbankrupt.<\/p>\n
But the price increases will boost living expenses, tempting
\nworkers to demand another round of wage hikes on top of the 7
\npercent wage increase.<\/p>\n
This latest increase was agreed in December last year, when
\nemployers and workers' representatives sat down together and
\nagreed that the minimum labor wage in Jakarta be raised by 7
\npercent, from Rp 591,000 (about US$66) per month to Rp 631,000.<\/p>\n
The agreement took effect on Jan. 1, but it has yet to take
\ninto account increases in utility charges, which could certainly
\neat into workers' purchasing power.<\/p>\n
Responding to possible labor demands for a wage hike, Sofyan
\nsaid that the increased utility charges should provide the right
\nmomentum for workers and employers to unite, standing together to
\nobject to government price hike policy.<\/p>\n
Sofyan said the increased utility charges were a blow to local
\nbusinesses as it would diminish their ability to compete with
\noverseas products.<\/p>\n
The Central Bureau of Statistics (BPS) reported on Thursday
\nthat the country's November exports had dropped by 23 percent, to
\n$4.1 billion from the level in October. The bureau did not
\nprovide an explanation for the drop, but some have said that the
\ncountry's manufacturers are losing competitiveness abroad.<\/p>\n
Sofyan said that the utility price hike policy would also
\nstifle domestic demand as people's purchasing power diminished.<\/p>\n
\"We are really in a difficult situation,\" he said.<\/p>\n
Separately, service industry players conceded that they would
\nalso be forced to shoulder a greater burden from the utility
\nrates hike.<\/p>\n
\"The government is being insensitive. As the tourism industry
\nhas not recovered yet, we've been hit hard by the utility rates
\nhike,\" said Yanti Sukamdani, chairwoman of the Indonesian Hotel
\nand Restaurant Association (PHRI).<\/p>\n
According to Yanti, hoteliers reckoned that their days would
\nbe numbered, unless the government stepped in to help them.<\/p>\n
\"The 10 percent hotel and restaurant (value-added) tax should
\nbe cut to 5 percent,\" she said.<\/p>\n
Internet services have also been hit hard by the utility rates
\nhike. \"Dial-up internet services will bear the burden of the
\ntelephone rates hike,\" said Heru Nugroho, chairman of the
\nIndonesian Internet Service Providers Association (APJII).<\/p>\n
Currently, there are 2,000 dial-up internet kiosks in
\nIndonesia.<\/p>",
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"sponsor": "Okusi Associates",
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