The national steel industry is facing heavy pressure amid sluggish\ndomestic demand and an influx of cheap imported products. In this\ncontext, Said Iqbal, President of the Indonesian Confederation of Trade\nUnions (KSPI) and the Labour Party, revealed the latest developments in\nthe wave of layoffs at PT Krakatau Osaka Steel (KOS).<\/p>\n
Said Iqbal stated that the number of workers affected by layoffs\ncontinues to rise, now approaching 200 from the previous figure of 161\nworkers.<\/p>\n
\u201cLayoffs at Krakatau Osaka Steel: the Labour Party together with KSPI\nhas established the Orange Post. There are 161 people laid off, but it\nhas increased, now approaching 200 people,\u201d said Said Iqbal to reporters\nwhen met at the Ministry of Manpower office, Jakarta, on Thursday\n(7\/5\/2026).<\/p>\n
According to him, one of the main causes of the pressure on the steel\ncompany stems from the slowdown in major government projects, including\nthe Nusantara Capital (IKN) project and toll road developments, which\nhave been the main markets for PT KOS.<\/p>\n
\u201cThe cause is that previously, PT KOS\u2019s consumers were IKN. The IKN\nproject and toll road projects. Because they have slowed down and tend\nto stop, steel demand has decreased. Therefore, rationalisation is\ninevitable, and it might even close,\u201d he said.<\/p>\n
Amid the layoff process, Iqbal mentioned that negotiations are\ncurrently ongoing between management and workers regarding the rights of\naffected employees.<\/p>\n
\u201cNegotiations are in process. Indeed, management will provide around\ntwice the regulation to give severance to the laid-off workers,\u201d he\nstated.<\/p>\n
In addition to weakening domestic demand, Iqbal also highlighted the\nintense competition with imported steel products from China, which are\nconsidered difficult to compete with in terms of price.<\/p>\n
\u201cBecause PT KOS products cannot compete in price with imported steel\ngoods from China, which are substandard\u2014we call them substandard, so\nthey are cheaper in value, with substandard measurements. Therefore,\nthey cannot compete either, that\u2019s correct,\u201d said Said Iqbal.<\/p>\n
It should be noted that PT Krakatau Osaka Steel (KOS) has even\nstopped production at the end of April 2026 and is scheduled to close\nall operations in June 2026. Spokesperson for the Ministry of Industry,\nFebri Hendri Antoni Arief, stated that the government understands the\nsocial and economic impacts of this decision, particularly for the\nworkers.<\/p>\n
\u201cWe are saddened by the situation faced by the workers of PT Krakatau\nOsaka Steel. The government understands that this decision has\nsignificant social and economic impacts. Therefore, we urge the company\nto fulfil the rights of affected workers in accordance with applicable\nlaws and regulations,\u201d said Febri in his statement on Tuesday\n(5\/5\/2026).<\/p>\n
The decision to halt operations was made at the beginning of the year\nthrough a board meeting on 23 January 2026. The company has been\nexperiencing financial pressure since 2022 due to the weakening domestic\nconstruction steel market and the flood of cheap steel imports.<\/p>\n
The Ministry of Industry assesses that this situation puts local\nproducers in a difficult position as they must maintain product quality\namid price pressures from cheaper imported steel.<\/p>\n
\u201cIn addition to limited product diversification, declining demand and\npressure from cheap steel imports, global oversupply conditions also\naffect the company\u2019s competitiveness,\u201d he said.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/nearly-200-krakatau-osaka-steel-workers-face-layoffs-heres-the-culprit-1778148978", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }