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President cites three reasons why Indonesia needs job creation law

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President cites three reasons why Indonesia needs job creation law (foto :


Indonesia needs to implement the job creation law in the wake of the COVID-19 pandemic to generate jobs, encourage the opening of new businesses, and curb corruption, according to President Joko Widodo.

“At the limited meeting (on Friday), I stressed why we need the job creation law,” he remarked in a press statement issued from the Bogor Presidential Palace the same day.

He said the first reason for implementing the law is that 2.9 million new job seekers, or youths, enter the labor market every year, which makes the creation of new jobs an urgent requirement.

The situation has been exacerbated by the COVID-19 pandemic, which has left 6.9 million people unemployed and 3.5 million workers affected, he added.

Nearly 87 percent of Indonesian workers have studied up to senior high school or lower, while 39 percent have only completed elementary schooling, the President noted. This has prompted the government to encourage the creation of job opportunities, particularly in the labor-intensive sector, he said.

“So the job creation law is aimed at creating as many job opportunities as possible for job seekers and unemployed people,” he remarked.

He said the second reason the law is needed is that it will make it easier for the public, particularly micro and small-scale entrepreneurs, to open new businesses.

The new law is aimed at simplifying overlapping regulations and lengthy procedures, he pointed out. For instance, micro and small businesses will now no longer need business permits, but will only have to register with the relevant agency, he said.

The law will also facilitate the establishment of limited liability companies because there will be no restrictions on minimum capital, he added. Under the new law, nine people can set up a cooperative unit, he continued.

“We hope there will be many cooperatives and micro small businesses in the country engaged in the food and beverage industry. The government will bear all expenses to (help them) apply for halal certificates. In other words, the certificates will be (provided) free of charge,” Widodo noted.

The third reason why the omnibus law is important is that it would support corruption eradication efforts in the country, he remarked.

“It is clear that by simplifying (procedures), cutting (expenses), and integrating the electronic licensing system, there won’t be illegal levies anymore,” he explained.

The House of Representatives (DPR) and the Indonesian government passed the controversial omnibus bill into law on Monday amid mounting criticism over its provisions on labor rights, indigenous community rights, and environmental protection.

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