Informal sector vital to help solve unemployement

JAKARTA (JP): A noted sociologist has underlined the importance of boosting the role of the informal sector so as to help solve the problem of unemployment, especially during the current monetary crisis.

Paulus Wirutomo of the University of Indonesia said boosting the role of the informal sector combined with the government's labor-intensive program was the most obvious thing to do in coping with the crisis.

He said labor-intensive funds could be allocated for operating small shops, kiosks or sidewalk stalls, which eventually could absorb more workers.

"Labor-intensive projects could be formed in many ways. Physical work such as dredging rivers, cleaning gutters and river normalization are very useful in protecting Jakarta's environment.

"Those works are productive in a way that can save Jakarta from worsening floods," he said.

But mere physical work is not enough, he said, adding that more workers, especially the unskilled, were being laid off.

Paulus warned of the possibility of a larger number of jobless workers entering the city from Jakarta's outskirts of Tangerang, Bekasi, Bogor and Cikarang.

"They probably are residents of Jakarta but work outside the city. Most of them are workers in factories on the outskirts of the city.

"Thousands of them, including non-Jakartans, will probably come in throngs trying to find a living here. It's going to be a heavy burden on the city."

The Jakarta office of the Ministry of Manpower has approved the laying off of 16,481 workers from 98 companies since January, and the number is likely to continue rising as the recession deepens.

Data from Tangerang's Federation of All-Indonesia Workers Union (FSPSI) shows that 21,700 workers have been laid off by 80 companies in Tangerang.

The 80 companies, most of which are shoe and ceramic manufacturers, were reportedly on the verge of bankruptcy due to a scarcity of orders and the exorbitant prices of imported materials.

Sabar Sianturi, head of the Jakarta manpower office, said the administration had done all it could to minimize the number of layoffs, but most companies were having a hard time keeping workers on.

"We're sorry about the situation but many of these companies found that business was virtually dead," Sianturi said.

Not all layoffs are reported to the administration, although by regulation a company must have its approval first.

Sianturi said most of the affected workers had worked for companies in the trading, construction, garment and textile, electronic, food and beverage, and pharmaceutical sectors.

Meanwhile, the chairwoman of the Indonesian Consumers Foundation, Tini Hadad, said the unemployment problem could only be solved if there was equal distribution of the fruits of development.

"Jakarta has become the center of every major activity in this country. From political affairs to economic affairs, all are centralized here.

"Many industrial estates are built on the outskirts of Jakarta. Why not build the in other provinces outside Java ... so there would be equal development?" she asked.

She said it would be little wonder if the city was flooded by unemployed workers during these hard times. (edt)