756 Workers at PT SGS Semarang Laid Off
A total of 756 workers at PT Sumber Grahend Sejahtera (SGS) in Semarang Regency, Central Java, have been laid off. The company is undertaking efficiency measures due to ongoing losses.
The Head of Industrial Relations and Social Security for Labour at the Semarang Regency Manpower Office (Disnaker), Chandra Wijayanto, confirmed the layoffs of the 756 PT SGS employees. He explained that PT SGS, a plywood factory, operates under the Sampoerna Strategic Group.
“The situation for the Sampoerna Group’s timber division is currently unstable across Indonesia. All branches have implemented efficiency measures, including this latest case in Butuh, Tengaran, where 756 people have been laid off,” Chandra stated during an interview on Tuesday (2/9/2026).
He added that the layoffs were carried out because PT SGS has been experiencing losses for at least the last three years. According to Chandra, these losses have been audited by public accountants, though he does not yet know the primary cause of the company’s deficit.
“The timber industry has been sluggish, even before the Covid pandemic. Post-Covid, it has yet to recover,” Chandra remarked.
Nevertheless, Chandra noted that PT SGS is still operational. According to data from the Semarang Regency Manpower Office, the number of PT SGS workers prior to the layoffs was 2,612.
“We have directed the company to engage in bipartite negotiations regarding the rights of those affected by the layoffs, as stipulated by law, such as 0.5 PMTK (Minister of Manpower Regulation) for permanent employees. Meanwhile, non-permanent or contract employees will receive compensation in accordance with Government Regulation (PP) Number 35 of 2021,” said Chandra.
According to Chandra, the majority of the affected workers were permanent employees. The official termination of employment for these workers took effect on 31 August 2026.
“Under the agreement between the parties, the severance pay will be paid in ten instalments over ten months, with payments made on the 15th of each month. We will continue to monitor these payments, both at the regency and provincial levels, on every scheduled date,” Chandra added.
He revealed that the Semarang Regency Manpower Office will continue to provide assistance to the affected PT SGS workers, including providing information on job vacancies.
According to Chandra, the PT SGS case is the only instance of mass layoffs occurring in Semarang Regency throughout 2026.