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View all search resultsIndonesia struggles to create jobs for its youth
According to research from the World Bank, one out of seven young Indonesians may find themselves out of work.
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People look for job information at the JobFest 2025 employment fair held on Aug. 19 at the Jakarta International Velodrome. (Antara/Muhammad Rizky Febriansyah)
I
ndonesia’s workforce is projected to grow strongly over the upcoming decade, but new research from the World Bank and Morgan Stanley finds the country is struggling to create jobs for its youth, and a short-term push for gross domestic product growth will not help much.
The latest edition of the World Bank’s East Asia and Pacific Economic Update, published on Tuesday, states that the employment rate in the region is “generally high, but the young struggle to find jobs”.
“Especially in countries like China and Indonesia, as many as one out of seven people might not have a job when they're young,” the World Bank’s chief economist for the region, Aaditya Mattoo, said in a press conference on Tuesday.
Job creation depends heavily on economic growth, and hence on policies and regulations that encourage economic activity like investment and consumption.
Indonesia, Mattoo said, had “been trying to grow faster than its potential growth rate,” which the government was trying to achieve by providing support in food, transportation and energy subsidies.
The report states that such a strategy might sustain growth today but “may not be conducive to growth tomorrow” and suggests instead to pursue deeper structural reforms focused on addressing nontariff barriers and simplifying business procedures and licensing, which “could enhance potential growth and productive job creation”.
It elaborated that Indonesia was among the countries that had not seen productivity-enhancing structural transformation, as reflected in a manufacturing employment share that remained virtually unchanged over the last three decades.
