TEMPO.CO, Jakarta – Indonesian President Prabowo Subianto announced a 6.5 percent increase in the provincial minimum wage for 2025. This announcement was made after a closed-door meeting at the President’s Office, the complex of the Presidential Palace in Jakarta, on Friday, November 29, 2024.
Several ministers, including Finance Minister Sri Mulyani, Coordinating Minister for Economic Affairs Airlangga Hartarto, Community Empowerment Minister Muhaimin Iskandar, and Manpower Minister Yassierli, were present at the meeting.
Prabowo said the minimum wage is an important social safety net for workers. Especially for workers who work for less than 12 months, considering the need for a decent living.
“Therefore, the determination of the minimum wage aims to increase the purchasing power of workers while taking into account the competitiveness of businesses,” Prabowo said at the Presidential Office.
The former TNI general said that the determination of the sectoral minimum wage will be carried out by the wage council at the provincial, city, and district levels. The Minister of Manpower Regulation will stipulate more detailed provisions regarding the minimum wage.
Here’s the list of the average provincial minimum wage from 2019 to 2023, based on reports from the Central Statistics Office (BPS).
1. Average Minimum Wage in 2019
In 2019, the average minimum wage was recorded at Rp2,455,662. This figure became the basis for calculating the minimum wage in subsequent years, taking into account inflation and economic growth.
2. Average Minimum Wage in 2020
The average minimum wage in 2020 increased to Rp2,672,371.36. Despite the increase, this year was marked by economic challenges due to the COVID-19 pandemic, which affected business sectors and people’s purchasing power.
3. Average minimum wage in 2021
In 2021, the average UMP increased again, although with a small percentage increase, reaching Rp2,687,723.69. This increase was determined considering the ongoing impact of the pandemic.
4. Average Minimum Wage in 2022
In 2022, the average minimum wage was recorded at Rp2,729,436.16, calculated based on Government Regulation (PP) No. 36 of 2021 regarding wages. This regulation is a derivative of Law Number 11 of 2020 on Job Creation.
5. Average Minimum Wage in 2023
In 2023, the average minimum wage increased significantly to Rp 2,923,309.40, with an average increase of 7.5 percent compared to the previous year. The calculation of this year’s minimum wage is based on the Minister of Manpower Regulation No. 18 of 2022.
6. Average Minimum Wage in 2024
The average value of the provincial minimum wage in Indonesia for 2020-2024 has continued to increase. In 2024, the average minimum wage value reached Rp3,113,359.85, where 38 provinces have set the minimum wage.
Previously, the Minister of Manpower had proposed a 6 percent increase in the minimum wage. However, the government decided to raise the figure to 6.5 percent after Prabowo Subianto received labor representatives at the presidential palace.
The chair of the Labor Party, Said Iqbal, confirmed to Tempo that the meeting with President Prabowo at the palace took place today. He expressed his approval of the UMP increase as it is considered close to the aspirations of the workers.
“The 2025 minimum wage policy will take into account the welfare of workers and the sustainability of the economy,” Iqbal said in a text message.
He stressed that workers would continue to fight for a sectoral minimum wage increase above the minimum wage. The workers also continue to reject the plan to increase the VAT by 12 percent and the contributions to the Social Security Administration.
MYESHA FATINA RACHMAN I DANIEL A FAJRI
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