Following the 8th Annual Islamic Finance Conference (AIFC) at the Ministry of Finance, in Central Jakarta, on Friday (4/10/24,) Indonesia’s Finance Minister, Sri Mulyani, claimed that there have been 11 million new job openings in the past three years, which coincided with a surge in layoffs, according to reporting from Tempo.
However, the minister did not provide specific details about the statistics she cited. Previously, she talked about the issue of mass layoffs in the previous year. Nevertheless, she emphasized that new job opportunities still exist. Therefore, she called for a comprehensive view of the economic situation.
“For instance, layoffs may occur in one area, but conversely, job creation is happening elsewhere. According to statistics, over 11 million new workforce positions or job openings were available in the last three years,” she said.
Tadjuddin Noer Effendi, a labor expert at Gadjah Mada University, stressed that it is crucial to distinguish between the workforce and job openings. “An increase of 11 million in the workforce does not necessarily imply that all of them are employed,” he told Tempo on Tuesday (8/10/24.)
He opined that the 11 million job openings mentioned by Minister Sri should be categorized into formal and informal sectors. According to the Central Statistics Agency (BPS), formal workers are those with employee/laborer status assisted by permanent labor, while informal workers are self-employed individuals, assisted by non-permanent labor, freelancers, and unpaid family workers.
“The informal sector indeed experiences a high job turnover as people enter and exit it frequently,” he explained. “So, it is crucial to clarify where these 11 million individuals are employed. Without further explanation, it can be misleading, suggesting a higher number of formal job openings [than is actually the case].”
Tempo reports that Sri Mulyani did acknowledge the informal sector in her explanation, citing GoJek as an example of a platform that provides job opportunities for driver-partners. She also highlighted the growth of new jobs in the digital sector.
Upon closer examination, the 11 million job openings mentioned by the Finance Minister may refer to the National Labor Force Survey (Sakernas) conducted by the BPS twice a year, in February and August. Sakernas is implemented in all provinces of Indonesia, with a sample of 7,500 census blocks (BS) or 75,000 households, according to Tempo.
Sri claimed that the creation of 11 million job openings occurred over the past three years, beginning in 2021. According to Tempo’s calculations, this figure can be derived by subtracting the number of employed people in 2024 from 2021.
Based on Sakernas, the number of employed individuals in February 2024 was 142.18 million, while the figure recorded in February 2021 was 131.06 million. When calculated, the difference between these two numbers equates to an additional 11.12 million people employed in the last three years, says Tempo.
However, the BPS definition of the working population is broad, encompassing both formal and informal workers, including formal workers with employee/laborer status to self-employed informal workers, even those working without pay.
Source: Tempo
