Business associations expressed objections to the request for an increase in the minimum wage by 7 to 10 percent in 2022 by the Confederation of Indonesian Trade Unions (KSPI). General Chairperson of the Indonesian Ceramics Association (Asaki) Edy Suyanto assessed that the proposed 7%-10% minimum wage increase is clearly very burdensome for the ceramic industry. Asaki hopes that the government can decide on the best and fair result for both parties, both industry players and workers. Meanwhile, Secretary General of the Indonesian Filament Fiber and Yarn Association (APSyFI) Redma Gita Wirawasta said that KSPI's proposal to ask for an increase in the minimum
wage by 7% to 10% is clearly very burdensome.
In addition, the expenditure burden will increase as the carbon tax is implemented next year. The textile industry was also under pressure due to rising global coal and crude oil prices.
"Actually, with the current conditions, an increase of more than 5% is already burdensome," said Redma, Monday (1/11/2021).
He admitted, in fact the textile business condition had started to improve amid the declining trend of Covid-19 cases in Indonesia.
Evidently, the factory's utility is already above the 80% level driven by improved market conditions and the abandonment of cheap imported textile products from China.
However, the improvement of the textile industry is currently considered to be more influenced by external factors such as the energy crisis in China, not because of government policies that directly target the sector.
"If the government can issue a semi-permanent policy to ensure the domestic market is safe for local products, we are optimistic that in 2022 there will be a recovery," said Redma.
The Chairperson of the Indonesian Outsourcing Business Association (ABADI) Mira Sonia considered that the proposed minimum wage increase was not in accordance with the Minister of Manpower Decree No. M/11/HK.04/2020 concerning Minimum Wage Determination in 2021 during the Covid-19 Pandemic.
Indeed, in the outsourcing industry, outsourcing companies will usually take advantage of management fees.
When the minimum wage increases, the management fee earned by the company also increases. However, again, the Covid-19 pandemic has put pressure on the outsourcing business.
“An increase in the minimum wage will make it difficult for the business world and cause a wave of massive layoffs in the midst of a crisis. This is a potential negative impact on workers, especially outsourced workers," said Mira, Monday (1/11/2021).
Currently, outsourcing business actors are still in the recovery stage after being hit by the negative impact of the Covid-19 pandemic.
"Currently, when it comes to anticipating wage increases, some outsourcing companies actually reduce management fees," he said.
Thus, many outsourcing companies are then switching to using technology for business operations.
This can streamline operating costs, help provide higher added value, and lower the cost of outsourcing services without compromising workers' rights.
The General Chairperson of the Indonesian Shopping Center Management Association (APPBI) Alphonzus Widjaja stated that the mechanism for increasing the minimum wage has actually been regulated in Government Regulation (PP) No 36 of 2021 concerning Wages.
Basically, shopping center business actors will continue to prioritize work that is safety, security, and health for workers, as well as temporarily postpone jobs with other categories.
"Currently, the main thing that shopping centers do is make efficiency," he added, Monday (1/11/2021).
According to him, each shopping center has different strategies for efficiency in order to survive the Covid-19 pandemic, including strategies related to worker welfare.