IT is driving recruitment, but unemployment creeps up in Indonesia

Investment and education required to boost jobseekers’ chances, say experts

More could be done by the Indonesian government to improve opportunities for jobseekers as unemployment figures continue to rise, say experts.

While the IT sector is set to drive the economy forward, the skillsets of local would-be employees are still lacking and a push is required towards stepping up education levels, they warned.

Figures released earlier this month by the Indonesian Central Statistics Agency (BPS) found an increase in year-on-year unemployment rates from 7.03 million in August 2016 to 7.04 million in the same month this year.

Chief statistician and head of BPS, Kecuk Suhariyanto, said the rise in the number of unemployed was due to the entrance of new jobseekers into the labour market.

Ruchika Gokarn, partner and executive coach at Potentia HR Jakarta, said the numbers were alarming and were affecting businesses across the country.

“We have seen a slowdown as well, especially in the first quarter of this year. Some of our clients have been talking of a recruitment freeze, and as HR consultants we have helped some clients shut down their Indonesia offices this year,” she said.

In the past few years, reports of massive layoffs by corporations as a result of the country’s economic slowdown have also caused concern for President Jokowi Widodo and added to the number of jobless young people.

Gokarn said she believed the government could take certain measures to lower the numbers and create jobs. “They should focus on improving the standard of education in the country; facilitate and improve the investment climate in the private sector by reforming policies; as well as investing in infrastructure,” she said.

Gokarn pointed out that while a large number of layoffs in certain sectors across the country was worrying, steady growth in Indonesia’s IT sector could provide a welcome boost to the economy.

Early last year, the government launched a five-year plan to develop the technology sector, and aims to make Indonesia the largest digital economy in southeast Asia by 2020. “For us, we battled a slow start to the year in terms of recruitment,” said Gokarn. “However, that picked up in the second quarter mainly on account of the startup, tech and digital sector growth.”

Even though the country has seen significant growth this year in the tech sector, Gokarn warned: “Local skills are just not available or up to par.”

The uncertainty in Indonesia’s employment market makes competition among jobseekers even more frenetic. Gokarn advised those looking for work to take some responsibility for improving their career opportunities. She said: “For experienced employees, I would recommend that you keep yourself current and keep upskilling within your industry. As for fresh graduates, it is important to look at the sector you are interested in and take up internships, even if unpaid, to get the real life work experience that companies are looking for.”

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