The Jakarta administration will set the increase in the minimum wage for workers in the city at 4.5 percent, or lower than the forecast inflation rate, predicted to reach 5.5 percent this year.
City secretary Muhayat said the increase had secured approval from city representatives, labor unions and business associations.
"It will take effect in January 2010. The governor has not signed it yet, but nothing will change," he said on Friday.
Head of the Manpower and Transmigration Agency, Deded Sukandar, said the new minimum wage was set at Rp 1,118,009 monthly (US$116), up Rp 48,144 on the 2008 figure.
"We set it based on a survey of a decent living wage," he said, explaining inflation had been taken into account.
"We have a team that evaluate the minimum wage; it is not determined randomly," he said, adding the wage was appropriate given the brighter economic forecast for 2010. With the 4.5 percent hike next year, workers in the city will see a smaller increase than in 2009, when the city saw many layoffs due to the global economic turmoil.
Workers in Jakarta got a 10 percent increase in the minimum wage, from the current Rp 972,604 ($89.22) to Rp 1,069,865 next year in a bid to prevent layoffs.
The Jakarta administration has gradually raised the provincial minimum wage, from Rp 711,843 in 2005 to Rp 819,100 in 2006, Rp 900,560 in 2007 and Rp 972,604 this year.
Lukman Hakim, a education coordinator at the National Front of Indonesian Workers' Struggle, was not satisfied with the increase.
He said the 4.5 percent increase was ironic compared to the planned salary increase for new Cabinet ministers, which was likely to be approved by the House. Under the new salary structure, the President will earn Rp 150 million ($15,000) in take-home pay per month, a Cabinet minister will earn Rp 70 million and a House member Rp 60 million. As of now, ministers receive between Rp 15 million and Rp 19 million per month on average.
According to his union's survey, the government needed to set up a national minimum wage of Rp 1.5 million. "We propose a national minimum wage of Rp 1.5 million for a single worker," Lukman told The Jakarta Post by phone.
Head of the Indonesia Employers Association (Apindo) Jakarta branch Soeprayitno said the 4.5 percent increase was good.
"There have been no complaints from employers over the increase that has been approved by the three parties," he said.
