Jakarta, CNN Indonesia —
Prior to the 2023 Provincial Minimum Wage (UMP) announcement, workers were shocked by statements from a number of employers that there were threats of termination of employment (layoffs) stalking employee Of Ilabor intensive industry.
At the end of last October, the general president of the Indonesian Textile Association (API) Jemmy Kartiwa Sastraatmaja said that the textile and textile products industry (TPT) was threatened by a firestorm of layoffs. He said that as many as 45,000 employees in the textile industry have been made redundant.
“The potential for layoffs can already be felt. An estimated 45,000 employees have started getting laid off,” said Jemmy CNNIndonesia.comWednesday (26/10).
He said this condition has occurred because demand for export markets, such as the United States and Europe, has dropped sharply due to unstable global conditions. The drop in demand has been around 30% since the end of August 2022.
“If this condition continues, more (employees will be fired),” Jemmy explained.
Not only that, the textile industry has also reduced the working hours of its employees. This is done to maintain industrial efficiency.
Jemmy’s statement was reinforced by Kadin’s Vice President for Maritime Affairs, Investment and Foreign Affairs, Shinta Kamdani. He estimates that the labour-intensive sector will be fired due to the collapse in market demand.
“Indeed, they (labor-intensive industries) are trying not to lay off, but again, this is difficult. As the demand and the market have dropped significantly, they are making a lot of efficiency,” Shinta said.
At the beginning of November, the hurricane of layoffs arrived. Advisory board member of the Indonesian Association of Employers (Apindo) and vice president of the Indonesian Textile Association (API), Anne Patricia Sutanto said that as of November 2022, 58,572 TPT workers across Indonesia have been made redundant.
Anne said the data was obtained from a survey of 78 non-API members and 146 API members.
Meanwhile, Firman Bakri, executive director of the Indonesian Footwear Association (Aprisindo), revealed that as of October 2022, 25,700 workers had been laid off. This number is expected to continue increasing through 2023.
Firman said the mass layoffs are due to a drop in demand for the footwear industry, which had already hit 50 percent. Falling demand and still modest incoming orders were also driven by Indonesia’s export destination countries, which still had excess inventories.
“If we studied in 2020, when our domestic market was fully stocked and not selling, it took more than a year for orders to enter the factory again,” Firman said.
Irony in a country with the highest economic rate in the world
Ironically, these layoffs occurred in a country where economic growth is said to be one of the best in the world.
Just look at President Joko Widodo (Jokowi) who once boasted that RI is the country with the highest economic growth in the G20 countries.
Indonesia’s economic growth was recorded at 5.72% in the third quarter of 2022. Meanwhile, Canada’s economy was only 4.6% in the same period.
Thus, Mexico 4.2%, China 3.9%, South Korea 3.1% and Italy 2.6%. Thus, the European Union 2.1%, the United States 1.8%, Japan 1.6% and Germany 1.2%.
However, Indonesia’s economic growth still lags behind that of India, Saudi Arabia, Turkey and Argentina.
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