Is Prabowo's Claim That Investment in Indonesia Has Created Millions of Jobs True?
President Prabowo Subianto claimed that investment in Indonesia continues to grow amid global uncertainty. He stated that investment realisation throughout 2025 reached Rp1,931 trillion and created more than 2.7 million jobs. Up to the first half of 2026, investment realisation was claimed to have surpassed Rp1,010 trillion with the creation of more than 1.4 million jobs.
“Alhamdulillah, thanks to our hard work and the people’s trust in the government, amid global uncertainty, investment continues to grow,” said President Prabowo in his speech at the 2026 MPR Annual Session on Friday, 14 August 2026.
Tempo verified the claim by examining official government data and interviewing two economists. The result: although investment has increased according to the claim, the pattern remains capital-intensive. Labour absorption actually declined in the first quarter of 2026.
The official website of the Ministry of Investment, updated 15 January 2026, recorded 2025 investment realisation at Rp1,931.2 trillion, while investment in the first half of 2026 reached Rp1,010 trillion. However, unlike Prabowo’s claim, the Ministry of Investment recorded the figures of 2.7 million and 1.4 million as workers absorbed—not new jobs created.
Economist from Brawijaya University Malang, Noval Adib, emphasised the fundamental difference between the two terms. Labour absorption refers to the number of workers employed in investment projects, including both workers who moved from other projects and former unemployed individuals. Job creation, meanwhile, refers to the opening of new opportunities for job seekers who have not yet been absorbed. “So if it is claimed that several million workers have been absorbed, that does not automatically mean they are additional new workers entirely caused by investment,” Noval told Tempo via WhatsApp message on Saturday, 15 August 2026.
Executive Director of the Institute for Development of Economics and Finance (INDEF) Esther Sri Astuti assessed that capital inflows into Indonesia tend to be capital-intensive. Purchases of fixed assets such as machinery and high technology dominate rather than labour absorption. “It is not labour-intensive investment to build factories that require a large workforce,” said Esther in a written message on Saturday, 15 August 2026.
This capital-intensive tendency is evident from the declining trend in labour absorption. In the first quarter of 2026, labour absorption was only 706,569 people—a sharp drop compared to the fourth quarter of 2025, which reached 754,186 people.
Esther stressed that investment realisation should not merely pursue nominal figures but must be of high quality and have leverage for the economy. To boost labour absorption, the government should direct investment towards labour-intensive industrial sectors.