Kompas -
January 6, 2009
Jakarta –
The National Statistics Agency (BPS) has announced that in comparison with the
second quarter of 2008, in nominal terms the average wage of industrial workers
in the third quarter of 2008 has declined by 8.74 percent. In real terms, the
wages of industrial workers over the same period have declined by as much as
11.30 percent.
Speaking in
Jakarta on Monday January 5, BPS deputy head Ali Rosidi explained that these
survey results were obtained by the BPS based on a sample of activities in the
formal industry.
“Not all
formal industries use the regional minimum wage as a reference. There are other
cases where increases in labour costs for companies are not reflected in
workers’ incomes, for example in healthcare and transportation facilities”,
said Rosidi.
In the third
quarter of 2008, the nominal wage of industrial workers averaged 1,095,790
rupiah per month, while in the second quarter of 2008 it was as much as
1,200,772 rupiah. If however this is compared with the third quarter of 2007,
an increase has occurred in the average nominal wage of 7.89 percent but real
wages for the same period declined by 4.93 percent.
Confederation
of Prosperity Labor Unions (K-SBSI) president Rekson Silaban said that the
decline in the average nominal wage is an impact of the large number of
contract workers. This situation was [not] reflected because the BPS calculated
the average nominal wage of formal workers without differentiating between
types of employment.
“As soon as
it’s taken as an average, the nominal wage of industrial workers declines. This
indicates the negative impact of contract labour systems because they are
employed under levels of welfare and guarantees that are non-standard”, said
Silaban.
Labour
intensive industries such as textiles and textile products (TPT), electronics
and automotives are currently tending to increase the number of contract
workers. Gradually, they are reducing permanent workers in order to bring down
costs.
According to
Indonesian Metal Trade Workers Federation (FSPMI) president Said Iqbal, almost
80 percent of the employees in TPT industries are now contract labourers. This
practice makes it easy for investors to relocate factories and seek more
competitive locations.
Iqbal said
that nominal wages have tended to increase in concert with minimum wages and
periodic pay increases. It is because of this therefore, the increasingly large
number of contract workers picked up in the BPS survey is most likely the main
factor in the decline in nominal wage levels between February and August 2008.
“What has
clearly been happening up until now is a decline in the real wage. FSPMI
research results [show that] the 2004 Jakarta provincial minimum wage, which
stood at 671,600 rupiah per month, was more adequate that the 2009 minimum wage
of 1,069,000 per month. Although there has been an increase in the nominal
[wage] of almost 80 percent, the value of the real minimum wage for 2009 is
only around 700,000 or so”, said Iqbal.
Unemployment
rate
Also on
Monday, the BPS announced that the unemployment rate for August 2008 had
declined to 8.39 percent compared with the February 2008 figure of 8.64
percent, or the August 2007 unemployment rate of 9.11 percent.
The quality
of the decline in the unemployment rate however remains unsatisfactory. The
deputy head of the BPS’s social statistical division, Arizal Ahnaf, explained
that the increase in employment opportunities has mostly taken place in the
social service sectors, particularly domestic workers, construction workers and
cleaning staff. (DAY/HAM)
[Translated
by James Balowski.]
