Minimum wages set to rise by 12% in most provinces
Minimum wages set to rise by 12% in most provinces
By Ridwan M. Sijabat
CISARUA, West Java (JP): The official minimum wage levels in most provinces will rise by at least 12 percent on April 1, a senior official of the Ministry of Manpower said on Saturday.
L.E. Lubis, the director for wage and social security affairs, said the increase accounts for various factors, including the inflation rate and the need to improve the overall welfare of workers.
"The government feels that the 12 percent increase is fair and acceptable," Lubis told The Jakarta Post during a break in a workshop on manpower affairs for journalists.
The new increase will raise the minimum wage in Jakarta and West Java to Rp 5,100 ($2.2) from Rp 4,600 at present, while the minimum wage level in Batam will increase from Rp 7,500 to Rp 8,400.
He said that in some provinces, where minimum wage levels are considered extremely low, the increases will be higher -- some even 50 percent. Provinces in which minimum wages are considered too low include Central Java, Yogyakarta, South Sulawesi and East Nusa Tenggara.
In the case of Central Java, the minimum wage will increase by almost 50 percent from Rp 2,850 to Rp 4,000, Lubis said.
By regulation, the minimum wage level in each province is set by a provincial wage council which involves representatives from the workers union, employers and the government. The wage increases must then be approved by the Minister of Manpower.
Lubis said the hikes in the minimum wage levels will soon be formally announced, giving employers more than three months to prepare and adjust their books.
"Learning from past experience, it is very important for the government to announce the new minimum wage levels well in advance so that employers have no excuse not to comply," he said.
In 1992, many employers refused to raise their workers' wages to comply with the minimum wage level because they were given less than a month's notice. Their refusal led to many strikes, some violent, in Jakarta and other major industrial centers.
Meanwhile, during the workshop on manpower affairs, the Director General for Labor Placement, Abdul Rachim said Indonesia must brace itself for an influx of foreigners looking for work in the coming years.
Rachim said trade liberalization mandated under the General Agreement on Tariffs and Trade (GATT) requires countries to open up their labor market. "As a consequence of GATT, we can no longer bar, or even limit, the number of expatriates in the country."
Trade liberalization and economic globalization saddles Indonesia with the challenge to strengthen the skill of its workers, he said. "We will lose in the free labor market unless we strengthen the quality of our human resources."
He said there are currently well over 330,000 foreigners working in Indonesia and the number is continuously rising.
Mudjianto, secretary of the Directorate General for Training and Productivity, admitted that Indonesia, compared to many other countries, had been slow in developing its human resources.
He said however the country still had time to catch up.
The government, he said, citing an example, is now revamping its vocational training centers.
"This is a good initial step to create professional workers.
"We should be optimistic that with the intensification of training programs and education system, Indonesia will eventually have a workforce that is educated, skilled and professional," Mudjianto said.