Workers Union, KADIN at Odds Over Jakarta Minimum Wage Increase

TEMPO.CO, Jakarta - The decision by Jakarta Governor Anies Baswedan to revise the 0.8 percent increase of the city’s minimum wage (UMP) to 5.1 percent for 2022 was met with split responses from workers' union and business owners. 

The president of the Indonesian Trade Union Confederations (KSPI) Said Iqbal on Sunday argues that the significant percentage growth actually benefits both sides, as he believes this will increase people’s buying power, “So, cheer up entrepreneurs,” Iqbal mentioned in a video on December 19. 

He said the buying power of Jakartans can grow to an estimated dozens of trillions of rupiah. “Those who benefit from this are not just entrepreneurs, not just labor workers. So businesses should not feel anxious,” he added. 

However, the Indonesian Chamber of Commerce and Industry (KADIN) chairperson Diana Dewi has strongly protested the sudden minimum wage change introduced by the governor and deemed it was an arbitrary decision. 

She said a large number of businesses will continue to refer to the UMP that was initially set by the Jakarta Wage Council. 

“Others have said they are unable to construct other strategies if the 2022 minimum wage is increased by 5.1 percent,” she said on December 19.

Anies Baswedan announced the adjusted UMP percentage for 2022 on Saturday, December 18. This changes the minimum increase of 0.8 percent or Rp37,749 to a larger number that will be imposed on employers based in the Capital City. 

Read: Jakarta Minimum Wage Increase is for the Good of the Community: Deputy Governor

M HENDARTYO | LANI DIANA