Government urged to start more labor-intensive schemes
YOGYAKARTA (JP): The government is being urged to implement labor-intensive programs throughout the country to avoid possible unrest due to the swelling number of unemployed or laid-off laborers.
Sociologist Nasikun told The Jakarta Post that such projects should not only focus on Greater Jakarta.
"Have they thought about the conditions in the outer regions? I can understand that the largest allocation has gone to Jakarta, but don't neglect the regions," said the Gadjah Mada University lecturer.
Nasikun warned that labor unrest could spark larger social unrest.
"In the short-term, the projects are the most appropriate step, at least till March. The government is of course concerned about securing everything for the general session of the People's Consultative Assembly," he said.
To help alleviate the number of unemployed laborers, the government has initiated labor-intensive programs for unskilled laborers.
The Rp 33 billion labor-intensive public works project in 30 mayoralties and regencies in Jakarta, and in West, Central and East Java is aimed at creating temporary jobs for 3.9 million people. It will run until March.
The local chairman of Yogyakarta's Association of Indonesian Young Entrepreneurs (HIPMI), Dwiyanto, said about 75 percent of the branch's 300 members are faced with the threat of closing their businesses due to the dire economic situation.
Dwiyanto said yesterday that should the situation continue, many would be driven to bankruptcy.
"The main problem is we don't have enough funds to pay employees' salary and the bank loan," Dwiyanto told The Post.
Of the 300 members of HIMPI, 80 percent are small enterprises while the rest are lower-middle enterprises. They include property, construction, agriculture, education and other service sectors.
Almost all the businesses are said to funded mainly by bank loans.
But interest rates have shot up and the number of loans available are extremely limited.
"In the past three months we could only get a maximum loan of Rp 50 million with interest of between 24 percent and 27 percent per year from state banks and up to 34 percent a year from private ones," he said, adding that most of HIPMI's members were debtors of the private banks.
Nasikun said that a severe paradox now faced the nation as the demand for an increase in the minimum wage was critical at a time when businesses were facing tough economic prospects.
He said that minimum wages at its current level was only sufficient to sustain daily living, while prices were continuing to soar.
"In such a crisis situation as we are facing now, I can imagine the difficulty in their lives," he said.
Nasikun said he therefore supported a recent proposal by industry associations which suggested that the money companies have to pay to the state social insurance company PT Jamsostek for each worker be diverted instead to pay for wage increases.
"During such a crisis situation it could very well be used to help pay for a wage increase ... It's better than being used to pay for a meeting of legislators," he said referring to a recent scandal in which Minister of Manpower Abdul Latief admitted that billions of PT Jamsostek funds had been used to finance deliberations of a controversial manpower bill. (swa/44)