Manpower Ministry: Skill Mismatch Main Factor Behind High Educated Unemployment
The Ministry of Manpower (Kemnaker) considers the mismatch between workforce competencies and the needs of business and industry (skill mismatch) to be the main factor behind the relatively high number of educated unemployed people in Indonesia.
“The phenomenon of unemployment among university graduates is caused by a mismatch between job competencies and the skills possessed, as well as low digital literacy and soft skills,” said Anwar Sanusi, Head of the Manpower Planning and Development Agency (Barenbang) at Kemnaker, when contacted in Jakarta on Thursday.
Statistics Indonesia (BPS) recorded that the number of unemployed people with university backgrounds (Diploma IV, S1, S2, to S3) in Indonesia reached 1,033,182 people as of May 2026. This figure accounts for around 14.31 percent of the total 7.22 million national unemployed.
Furthermore, Anwar said another factor is the slow growth of formal employment, while the number of fresh university graduates continues to rise.
In addition, he believes that rapid technological developments and industrial transformation have not been fully matched by the education and training system, leaving many graduates without the competencies required by the labour market.
Meanwhile, Faried Abdurrahman Nur Yuliono, Head of the Public Relations Bureau at Kemnaker, added that limited work experience, mastery of soft skills, and competency certification are also factors affecting the low absorption of labour.
“The sector most affected by this challenge is the technology-intensive industrial sector. In several industrial areas, such as Batam for example, incoming investment requires very specific qualifications,” said Faried.
Faried said Kemnaker continues to work to address the mismatch between educational graduates and industry needs.
Several measures being taken include aligning curricula with industry competency needs, strengthening industry involvement in the learning process, and improving the competencies of teaching staff.
“Furthermore, expanding work practice and industry experience for students, as well as conducting periodic evaluations based on developments in labour needs, so that graduates have competencies relevant to the needs of the world of work,” he said.