Indonesia to raise minimum wage in 2025 by 6.5%

INDONESIA’S minimum wage for its workers next year will be raised by 6.5 per cent, its president said on Friday (Nov 29), an increase that follows a court decision that labour groups hoped would bring a larger hike.

The increase comes as the Constitutional Court ordered changes to the 2020 Job Creation law, including the establishment of sectoral minimum wages last month, which labour groups had hoped would raise next year’s minimum wage by up to 10 per cent.

President Prabowo Subianto told a press conference the 6.5 per cent increase “is intended to raise workers’ purchasing power while considering businesses’ competitiveness”.

The average provincial minimum wage for 2024 is 3.1 million rupiah (S$262).

Said Iqbal, president of the Indonesian Trade Union Confederation (KSPI), which heads a number of labour groups, said on Friday the group accepted the hike.

Prabowo also said his vaunted programme to give free meals to school children will cost the state 10,000 rupiah per serving, after the previous estimate of 15,000 rupiah each, citing a budget issue.

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In the first stage of his plan, meals will be given to about 20 million students from January at a cost of 71 trillion rupiah. REUTERS