Purbaya Responds to Layoff Threats in Five Industrial Sectors

The government is responding to concerns over a wave of layoffs in several manufacturing sectors by assessing that industrial dynamics are always accompanied by the emergence of new businesses. Finance Minister Purbaya Yudhi Sadewa stated that pressures on certain sectors are indeed occurring, but economic growth continues to open up opportunities for new job creation. “Businesses always rise and fall. What I see is the net effect. If five fall, are there any rising?” Purbaya said during a Media Chat at Kebon Sirih, Jakarta, on Wednesday (6/5/2026). Previously, labour groups warned of potential layoffs in five industrial sectors over the next three months, namely textiles and textile products, plastics, electronics, automotive, and cement. The pressures are said to stem from weakened purchasing power, rising costs of imported raw materials, and global economic uncertainty. Purbaya believes that the industrial situation cannot be viewed solely from companies experiencing declines or closures. According to him, Indonesia’s economic growth, which remains above five percent, should also encourage the emergence of new companies and the absorption of labour. “If economic growth is fast as it was before, there should be new job creation and many new companies emerging,” Purbaya stated. Nevertheless, Purbaya acknowledged that business actors are still haunted by concerns due to global pressures and negative market sentiments. This condition is seen to affect business psychology in undertaking expansions. “It seems that even though things are good, people are still a bit scared. Because many are scaring others, saying it’s going to be like 1998 and so on,” Purbaya said. The government, Purbaya continued, will maintain banking liquidity so that financing for the business world remains available. This step is hoped to support industrial expansion amid global slowdowns. “We will ensure that banks have sufficient funds in the economic system so that the business world can access financing,” Purbaya stated. The government is also preparing special support for export-oriented manufacturing industries, particularly the textile sector, which is beginning to struggle to obtain loans from banks because it is considered a sunset industry. Purbaya said the government has discussed with textile associations and is preparing financing support through the Indonesia Export Financing Agency (LPEI), including the possibility of lower interest rates for industrial machine renewal. “We are strengthening the textile industry here. They have trouble getting bank loans, so we are pushing through LPEI,” he said. In addition, the government will tighten surveillance of illegal imported goods and maintain public purchasing power to support economic growth in the second quarter of 2026. “The key to second-quarter growth is maintaining purchasing power, encouraging spending, and improving the investment climate,” Purbaya stated.