Economic Development and Wage Increase

In Indonesia in recent years, salary levels continue to rise with rapid economic development.
The minimum wage in Indonesia was renewed every year referring to the need for decent living standard (KHL) per month determined by the experts in the past, but since 2016 the inflation rate and actual GDP growth rate have become the basis of calculation and the review of the need for decent living standard (KHL) that used to be revised every year has become to be assessed every 5 years. For this reason, it is said that the minimum wage in Indonesia will continue to rise by 10% every year for the time being.

※Based on the data published by Jakarta Special Province, PT. OS Selnajaya Indonesia created the chart

However, considering high economic growth rate and consumer market size of Indonesia that consists of 240 million population, the labor costs of Indonesia compared to its economic growth rate and actual GDP still has strong competitiveness towards neighboring Asian major countries.

Allowances that do not exist in Japan

In Indonesia where it is compulsory for all nation to belong to the religion, allowance of minimum 1 month salary called religious allowance (THR) is obliged to pay. In addition to that, meal allowance, commuter assistance allowance, position allowance or expertise allowance are normally paid as a custom.
Since public transportation has not been developed well in Indonesia, commuter assistance allowance is often substituted by company’s own operated bus to the factory or a private car for manager level above, which such allowances are not very familiar in Japan.

Indonesian who care about career building and position

When Japanese companies look for employees, they often become confused with the difference of the style of working based on educational background or cultural background and career building.
Generally speaking, the concept of general staff (or Management trainee) employment is not familiar in Indonesia as Indonesian workers tend to build their careers by specializing in one specific field.
Furthermore, Indonesians are said to be conscious about the position and hierarchy to prove their career as they relatively have no negative image about job-change.

Recruitment issues

In spite of time and money consumed to train a new employee, they often soon resign and move to another company which arouses a big issue for the company to recruit immediately a substitute who can replace in force as quickly as possible.
Each company is wondering how they can make employees to work in a long-term and how they can substitute an adequate employee as immediately as possible.
It is necessary to consider these aspects in the employment as regionality or lifestyle based on religious beliefs or multiethnic country consisting of 300 races or more, are very different from Japan.

※Japanese staff who are well acquainted with Indonesian labor and manpower condition will give an advice in each process.
※We conduct language check and simple aptitude test at our company beforehand.
※We can arrange medical checkup or detailed aptitude test by a certified specialist based on a request with additional charge.