The President of the Labor Party, Said Iqbal warned that there would be a massive wave of layoffs (termination of employment) in Indonesia. According to him, the first wave of layoffs occurred after Covid-19 which occurred as a result of the impact of yesterday's pandemic. At that time, the economy was down, which resulted in massive layoffs. "Nearly a hundred thousand workers were laid off in the first wave. Especially in labor-intensive or labor-intensive industries, such as textiles, shoes, food and beverage, and industries related to the digital economy," said Said Iqbal, Saturday (24/6).

Meanwhile, the second wave of layoffs occurred recently. Based on research and development data from the Confederation of Indonesian Trade Unions (KSPI) and the Labor Party, the figure is close to 70,000 workers. The cause is still related to the after-effects of the Covid-19 pandemic.

"The affected industries are textiles, garments, shoes. This happened because the markets in Australia, America, and other export destination countries had decreased purchasing power so that sales of branded goods produced in Indonesia decreased. Because sales decreased, the buyers who produced these shoes eventually lowered their orders. When orders fall, the impact is layoffs," he explained.

Now, said Said Iqbal, workers are being haunted by the threat of a third batch of layoffs. There are at least three things that are the cause of the third wave of layoffs. The first cause is purchasing power that has not yet recovered at points of sale for textiles, garments, shoes, food and beverages. Because purchasing power has not improved, companies that receive orders are increasingly reducing their production.

The second cause is the flood of imported goods which eroded the domestic market. Textile, garment and shoe factories that should be able to fill the domestic market ended up being unable to compete with imported products. Moreover, in Indonesia the competitiveness is high due to overhead costs and there are still many extortions.

Meanwhile, the third cause is workers' wages which were deducted by Permenaker Number 5 of 2023. The aim of the Permenaker is to avoid layoffs, but the facts do not prevent companies from doing layoffs.

"There is no relationship between layoffs and wages. Layoffs occur related to orders. What actually happened was that wage cuts eventually reduced purchasing power, which resulted in lower consumption. Declining economic growth is not attractive to companies that place orders," said Said Iqbal.

"For this reason, the Labor Party and KSPI have asked for orders to seriously take steps to avoid a third batch of layoffs, because there are potentially tens of thousands of them," he said.

Therefore, the Labor Party and KSPI offered several concrete suggestions to prevent layoffs. First, reduce imports of apparel and shoes from China. Currently, the domestic market is being invaded by imported goods. Even though the domestic market can be filled by domestic industry, so companies do not layoffs because they can still produce to meet the domestic market.