- Indonesian government focuses on link-and-match programs to align education with labor market needs, aiming to reduce the 4.91% unemployment rate as of August 2024.
- As of February 2025, Indonesia’s workforce reached 153.05 million, but 7.28 million remain unemployed, including 1.01 million university graduates, due to poor job absorption.
- Finance Minister Sri Mulyani Indrawati highlights fiscal policies’ role in lowering unemployment, with enhanced job market information systems and workforce capacity building as key strategies.
The Indonesian government has been particular about measures that intend to connect and pair the education sector with the labor market in a bid to lower the country's unemployment rate, Finance Minister Sri Mulyani Indrawati said.
The minister referred to the strategy in wake of a report by Statistics Indonesia (BPS), which indicated that as of February 2025, Indonesia has 7.28 million unemployed citizens, 1.01 million of whom are university graduates.
"The government is committed to improving link-and-match programs that connect the education sector with the business sector, enhancing job market information systems, and increasing workforce capacity", she said on Tuesday in Jakarta.
Speaking at the 24th Plenary Session of the House of Representatives (DPR), Indrawati emphasized that despite being one of the biggest problems of the country, employment has been effectively curbed by fiscal policies to lower the open unemployment rate to 4.91 percent as of last August. That is 0.41 percentage points lower than the corresponding period in the previous year.
"This indicates that if effectively, selectively, and wisely used, the State Budget can maintain Indonesia on course and safeguard individuals in the most vulnerable groups", said the minister to DPR lawmakers.
BPS statistics indicate that by February 2025, Indonesia's workforce was 153.05 million strong, up from 3.67 million more than February a year ago. But because of poor job absorption, the unemployed residents increased by 83,450 over the period.
Earlier, Manpower Minister Yassierli had also pointed to the difficulties for Indonesian university graduates to find employment. "This is a challenge for us. This is the reality we are dealing with", he said at the Parliamentary Complex in Jakarta.
Against this background, he emphasized the importance of coordination between the Manpower Ministry and other institutions, particularly the Ministry of Higher Education, Science, and Technology, to seek the most optimal solutions.
