Indonesia’s Jobless Rate Surges to Nine-Year High Amid Recession
Commuters wear protective masks and face coverings in Jakarta, Indonesia. (Photographer: Dimas Ardian/Bloomberg)

Indonesia’s Jobless Rate Surges to Nine-Year High Amid Recession

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Indonesia’s unemployment rate surged to the highest level since 2011, as the pandemic causes 29 million people to lose their jobs or move to part-time work.

The jobless rate rose to 7.07% as of August, from 5.23% a year ago and marking its highest level since the 7.48% seen in 2011, according to the nation’s statistics agency. The number of people without work expanded by more than a third to 9.8 million as the pandemic pushes Southeast Asia’s largest economy into its first technical recession in two decades.

Overall the pandemic has impacted 29 million Indonesians, or close to 15% of its labor force. On top of those who lost their jobs, about 9.5 million exited full-time employment, while those working fewer than 35 hours a week increased by 9.2 million.

President Joko Widodo’s government has rushed the passage of an omnibus law that relaxes labor rules and slashes red tape in a bid to encourage job creation and position the economy for a turnaround in 2021. While the move has been welcomed by business groups, workers and activists continue to protest against it saying the changes would erode labor rights. A labor union has filed a judicial review to challenge the law.

Other Highlights

  • Jakarta suffered the worst unemployment rate at 10.95%, followed by surrounding provinces Banten at 10.64% and West Java at 10.46% as they bore the brunt of lockdown measures
  • The informal sector expanded to 60.5% of total workers as of August from 55.9% the year before, as more people take up unpaid work for their families
  • Women’s participation in the labor force gained slightly to 53.13%, from 51.81%, while men’s role eased to 82.41%, from 83.25% -- though the statistics office didn’t specify whether this reflects those working for their families without pay

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