Manpower Minister: Outsourcing Contract Provision Put Labor at a Loss

I know of a number of Multi-nationals who have decided to keep manufacturing levels at the same level or reduce them in Indonesia because of the Manpower here. There are still concerns about quality at a global level as well as reservations about the overly protective manpower regulations. Even more concerning is that global and regional head offices are starting to complain about the cost of employing white collar workers and the Indonesian salary demands of 30% increases when changing jobs.

The Gap between pay for Local top management and Expat management is getting very narrow. If the trends continue we could see a number of players leaving Indonesia.