JakartaPost-July 17
Most Indonesian workers are employed in the informal sector, and their number is growing, due primarily to labor informalization, experts say. Data from Statistics Indonesia (BPS) show that, as of February this year, the group comprised more than 60 percent of the 138.63 million active workers in Indonesia, compared with the 56.64 percent of the working population in February 2020. BPS describes the informal sector as being characterized by a lack of legal registration and by self-employment of workers in “invisible” locations, such as small shops that tend to remain small-scale operations. “From the argument of decent livelihood and income, it is obviously a problem,” Association of Lecturer and Labor Law Practitioner Indonesia (P3HKI) chairwoman Agusmidah told The Jakarta Post on Thursday. Labor experts say most informal workers have a low level of education, with the majority of elementary and middle school graduates ending up in the informal sector. Over 70 percent of people in the group with no education higher than elementary school worked as informal workers in 2022, while that share dropped to 59 percent among middle school graduates, BPS data show. The national average net income for the former group was between Rp 1.3 million (US$86) and Rp 1.6 million per month, whereas the latter averaged Rp 1.89 million, BPS said. The higher the education level, the smaller the proportion of people working in the informal sector, and the higher the salary, with high-school graduates averaging more than Rp 2 million in monthly income. The number of informal-sector workers has risen over the past few years, partly because of the system of contract workers and outsourcing under the 2003 Labor Law, according to Gadjah Mada University (UGM) researcher Arif Novianto. Read more at: https://www.thejakartapost.com/business/2023/07/16/growing-informal-sector-signals-lack-in-job-creation.html.
