Indonesia’s Unemployment Rate Increases as Economy Slows
Jakarta. Indonesia’s unemployment rate increased in February, according to the latest data from the Central Statistics Agency, or BPS, amid slower economic growth.
BPS’s February 2015 data, released on Tuesday, showed there were 7.45 million unemployed people out of the total workforce of 128.3 million in the country. This means that the unemployment rate stands at 5.81 percent.
In comparison, in February last year the number of unemployed people stood at 7.15 million, representing 5.7 percent of the total 125.32 million workforce.
However, compared to the previous data received in August 2014, the unemployment rate declined, although the real numbers were still on the rise.
In August 2014, 7.24 million people were identified as unemployed, representing a 5.94 percent of the total 121.87 million people.
BPS also released data that showed Indonesia’s economic growth slowed to 4.71 percent, the weakest it has been in more than five years.
“Hence, in the absence of forthright stimulus from both monetary and fiscal fronts, for Indonesia to regain some growth mojo, there is no other way than for it to imbibe the bitter medicine of reforms,” said Wellian Wiranto, an economist at OCBC Bank in Singapore.
“From cutting bureaucratic red tape to freeing up of land for infrastructure projects as well as boosting labor productivity, there are plenty on the list of things the Jokowi administration ought to do to inch closer to the 7 percent target it has in mind,” he said.
Franky Sibarani, the chief of the Investment Coordinating Board (BKPM), said the government would stick to its guns with a target to create up to two million new jobs this year. “We will push for more job availability,” he said.
Still, data from BKPM showed that although total investment increased by 16.9 percent year-on-year to Rp 124.6 trillion ($9.55 billion) in the first quarter, job absorption declined. Direct investment in the country absorbed 315,229 workers in the first three months of this year, a decline from 470,510 in the fourth quarter of last year.
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Source: The Jakarta Globe