PRESIDENT of the Indonesian Workers Association (Aspek) Mirah Sumirat said that currently the number of workers continues to decline due to mass layoffs. As a result, people’s purchasing power could continue to decline. Data from the Ministry of Manpower states that from January to June 2024, 32,064 workers were laid off.
Mirah explained that with salaries that have not increased to the rampant layoffs, many lower middle class people are holding back on shopping. They are instead taking shortcuts to get additional income instantly by playing online gambling or online loans.
“The problem of mass layoffs and low wages can further reduce people’s purchasing power,” he said in an official statement, Saturday (10/8).
Mirah continued with the soaring prices of food and basic necessities (staple foods), impacting people’s purchasing power which is increasingly depressed. Then, the emergence of policies issued by the government that do not favor workers such as the increase in Value Added Tax (VAT) rates to 12% in 2025 is considered to further worsen the economic conditions of the middle class. The decision to increase taxes has an impact on increasing the price of goods.
“Taxes should be lowered to help lower prices, but instead the government is looking for other sources of funds to meet state spending needs and pay government debt,” said Mirah.
In addition, the portion of informal employment in the country is increasing. Based on data from the Central Statistics Agency (BPS), the number of informal sector workers in Indonesia has increased in the last five years. In February 2019, the number was still 74.09 million people or 57.27% of the total working population of Indonesia. That number increased in February 2024 to 84.13 million people or 59.17% of the total working population.
“This means that those who have irregular incomes tend to become poorer. People are also finding it increasingly difficult to meet their living needs. Many have turned to becoming online drivers, odd jobs, and others,” Mirah concluded.
(Z-9)
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