Page 53 - e-KLIPING KETENAGAKERJAAN 31 DESEMBER 2019

extension of working hours, more flexible outsourcing and reinforcement of
employers' rights to lay off staff for serious faults.

As a result, hundreds of workers took to the streets in protest of a planned revision
of the 2003 Labor Law. Upon closer inspection by The Jakarta Post, however, the
document is not a draft of the revision but is instead a 2018 analysis and evaluation
by the Law and Human Rights Ministry's National Law Development Agency.

"The government is still waiting for input from stakeholders, such as labor unions,
businesspeople and the public. So, as of today, we are still studying [labor
conditions] while waiting for input from stakeholders," former manpower minister
Hanif Dhakiri told the Post in August when asked about progress regarding the
Labor Law revision.

Aside from the 2003 law, "skill" and "human capital" were buzzwords this year in
government officials' speeches, including Jokowi himself.

One important context for the skill discussion craze is that Indonesia is expected to
reap from its huge working-age group, which will reach 70 percent of the total
population by 2030 -- experts call this a demographic dividend.

Yet the manufacturing industry and service sector, which are expected to absorb the
largest part of the labor force, are shrouded in uncertainty, while education alone
seems to be insufficient to land graduates a job, as seen in the unemployment rate
of vocational high school graduates. The rate stood at 8.63 percent of the workforce
in February 2019, followed by high school graduates at 6.78 percent, 2019 Statistics
Indonesia (BPS) data showed.

A study published in July by Alpha Beta and the Australia-Indonesia economic
development partnership Prospera highlighted that the problem was more deep-
rooted and called for systemic solutions and policies.

"There is a sense among stakeholders that the government has focused on
controlling skills supply rather than preparing the skills system to respond quickly to
demand," Alpha Beta researchers wrote in the report. "This generates a structural
inflexibility that hinders the suitability of graduates for positions available."

There are also challenges in ensuring workers receive the right level of education,
with fewer than 10 percent of Indonesia's 250 million people having university-level
education, based on BPS' 2015 national labor force survey.

A 2019 working paper published by the SMERU Research Institute last September
also showed that Indonesia had an "extremely small" proportion of individuals
skilled in literacy and numeracy when researchers used an international benchmark.

This is despite the fact that, according to the Research and Technology Ministry's
calculations, Indonesia needs at least 113 million skilled workers by 2030 to achieve

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