"We certainly want to encourage companies, as Kadin, to try everything possible to avoid layoffs," Anindya told a press conference in Jakarta on Sunday, as quoted by Antara.

He emphasized that layoffs should be the last resort for businesses because they would only increase the number of people without income, further worsening the economic situation.

Anindya acknowledged that every company faces unique circumstances, with some businesses under significant pressure to balance sustainability and employee welfare. However, he hoped that innovative solutions could help avoid difficult decisions such as layoffs.

President Prabowo Subianto announced on Friday an average increase of 6.5 percent for the UMP in 2025.

Kadin also highlighted the government’s plan to establish a Layoff Task Force (Satgas PHK), which was expected to assist businesses in finding solutions to avoid layoffs following the UMP adjustment.

"But we want to see how this task force works. It will likely collaborate with the business sector. After all, it’s businesses — whether state-owned enterprises [SOEs], cooperatives or private companies — that carry out layoffs. So, we will stay in communication and monitor the situation," Anindya said.

On Sunday, Coordinating Economic Minister Airlangga Hartarto said that the government would soon establish a Satgas PHK after the 2025 minimum wage increase was announced.

Airlangga said Satgas PHK was the government's response to potential layoffs by companies in 2025.

However, Airlangga did not provide further details on when the task force would be formed, or which stakeholders would be involved.

He said that the government considered the industry’s fundamentals in deciding the UMP increase and that he would study the plan to establish Satgas PHK so that the aims were achieved.

With the increase, Jakarta, for example, will have an UMP of about Rp 5.39 million (US$339) per month in 2025, up from Rp 4.90 million in 2023 andf Rp 5.06 million in 2024, Kompas estimated on Saturday.