The Open Unemployment Rate is Better Compared to Before the Pandemic

The government must think about how to create better, permanent and decent jobs.

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Job Seeker Illustration

JAKARTA, KOMPAS  — The open unemployment rate in February 2024, according to data from the National Labor Force Survey of the Central Bureau of Statistics, reached 4.82 percent. The achievement of this TPT figure is better than before the Covid-19 pandemic.

According to the Central Statistics Agency (BPS), the open unemployment rate (TPT) is an indicator used to measure the workforce that is not absorbed by the labor market and depicts the underutilization of the labor supply.

Also read: The Practice of Unilateral Layoffs Still Colors Complaints of Labor Violations

According to the National Labor Force Survey (Sakernas) data from BPS, the open unemployment rate (TPT) experienced an increase of more than 5 percent during the Covid-19 pandemic. In February 2021, the TPT reached 6.26 percent. Then, the TPT in February 2022 was recorded to have decreased to 5.83 percent. Furthermore, the TPT in February 2023 slightly dropped to 5.45 percent.

Before the Covid-19 pandemic occurred, data Sakernas BPS in February 2020 showed that the national TPT reached 4.94 percent.

However, in line with the declining TPT figures for February 2024 compared to the TPT figures from three years ago, data from Sakernas BPS for February 2024 shows an increase in the number of people classified as semi-unemployed or those whose working hours are below normal working hours (less than 35 hours per week) and are still looking for work or willing to accept other jobs. The semi-unemployment rate in February 2024 was 8.52 percent. Compared to February 2023, the semi-unemployment rate increased by 1.61 percent.

"That means the quality of job creation is lacking," said Teguh Dartanto, a lecturer at the Faculty of Economics and Business at the University of Indonesia, on Tuesday (7/5/2024) in Jakarta.

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Job seekers submit job applications at one of the booths at the Atrium Pondok Gede job fair, Jakarta, Friday (26/7/2019).

According to him, upon closer examination, Sakernas BPS data in February 2024 also mentioned that there were around 1.81 million new workers employed in the trade, accommodation, and food sectors, which means that many of the jobs are not permanent. Teguh suspects that the job creation in February 2024 is largely temporary because of the election season. Furthermore, the number of government administration workers also increased by 760,000 people.

"Absolutely, Indonesia's open unemployment rate can still be said to have not fully recovered compared to before the Covid-19 pandemic. What needs to be anticipated is the post-presidential and regional head elections condition. The government needs to think about ways to create better, permanent, and decent job vacancies," said Teguh, urging for action.

Also read: Contract Employment Relations are Increasingly Developing

Secretary General of the Indonesian Workers Organization (OPSI), Timboel Siregar, sees that regarding the rising rate of half-unemployment, there is a possibility that those who belong to that group are truly unemployed. However, they tend to state that they work just to receive minimal wages rather than not working at all. This is what is recorded by the Indonesian Central Statistics Agency.

In line with Teguh's opinion, Timboel suspects that formal job opportunities are actually limited at present. If left unaddressed, this could have a negative impact on the workforce as their welfare is eroded.

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Participants are receiving training on air conditioner maintenance at the Community Cooling Technology Training Hall of the Panasonic Gobel Workers' Union Federation in Cipayung, East Jakarta, on Wednesday (31/1/2024).

Looking at BPS's Sakernas data from the past three years, the recorded rate of underemployment has decreased. In February 2021, it was recorded as 8.71%, then in February 2022, it decreased to 7.86%, and in February 2023, it decreased again to 6.91%.

Coordinator of the Media and Communication Division of the Union of Media and Creative Industry Workers for Democracy (Sindikasi), Bimo Aria, has stated that in the job market, there is a growing practice of short-term employment contracts and outsourcing in various industrial sectors in recent years. This situation not only promotes half of the unemployment rate but also causes the workforce to not have a clear career future.

"The existence of digital platforms as mediators and the very short duration of work differentiate the characteristics of gig workers from other precariat workers. However, the situation is the same. "People who work like that usually have to bear higher 'costs'," said Bimo, who was met at the public discussion event "Navigating Life in the Midst of Digital Transformation: Are Workers Protected", on Tuesday (7/5/2024), in Jakarta. This public discussion was organized by the Center for Innovation Policy and Governance.

President of the Indonesian Workers Confederation, Said Iqbal, separately conveyed that layoffs in the manufacturing industry sector have been on the rise in recent years. Workers who work in that sector and experience layoffs usually become unemployed. If they do work, they work miscellaneous jobs, such as becoming motorcycle taxi drivers and minibus drivers. Their working hours per day could be less than 5 hours.

According to him, the government needs to boost sustainable growth in the manufacturing industry. Then, the government must be willing to increase the effectiveness of job skills training programs, so that workers' competencies can improve and the industry can become more competitive.

Also read: Conditions of Outsourced Work Still Debated