A 44 percent rise in the Jakarta minimum wage has prompted a major employer organization to warn of mass layoffs as companies grapple with the increased production costs, and led analysts to suggest that a major increase in productivity was needed to justify the hike.
Employer groups have also expressed fears that the new Jakarta minimum wage of Rp 2.2 million ($228) a month, approved by Governor Joko Widodo on Tuesday, would prompt similar pushes for wage increases across the country.
Business said that Joko’s decision was driven by populism, and was an effort to show that he could meet the high public expectations before he took office last month.
Joko urged workers and employers to accept the Rp 2.2 million figure, and expressed hope that his decision would end a festering dispute between the two camps.
“If we talk about whether we are satisfied or not, then it will be an endless discussion, and we will never be able to decide on the figure,” he added. “I hope all parties can accept it.”
The Indonesian Employers Association (Apindo) voiced its opposition, saying that the increase was too great…
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Indonesia / A demonstration to raise the minimum wage turned rowdy
A demonstration to raise the minimum wage in Surabaya, East Java, turned rowdy on Tuesday, when thousands of workers from Gresik rallied in front of the governor’s office on Jl. Pahlawan.
Some workers grew enraged on Tuesday after learning that East Java Governor Soekarwo declined to meet with their representatives from the Gresik Labor Union.
The representatives left the governor’s office after they were met by Edy Purwinarto, the third assistant of the people’s welfare division.
As news of the perceived slight spread through the crowd, some started to push against the temporary barriers erected to block their access.
As police officers on hand to provide security formed a line, protesters pelted them with glass and plastic water bottles.