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Fewer companies will hire new employees this year as automation grows: Survey
Only 36 percent of companies plan to recruit new employees in 2020, a drop from 43 percent in 2019, according to a December report titled “Total Remuneration Survey 2019” published by global consulting firm Mercer.
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Employees work on concrete mold frames for the construction of the high-speed Jakarta-Bandung railway at a factory in West Bandung regency, West Java. (Antara/Raisan Al Farisi)
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alaries in Indonesia are expected to increase 8.7 percent across various industries in 2020, slightly higher than the 8.3 percent rise in 2019, yet fewer companies are planning to recruit new employees amid growing interest in automation, a recent survey projected.
Only 36 percent of companies plan to recruit new employees in 2020, a drop from 43 percent in 2019, according to the December report titled “Total Remuneration Survey 2019” published by global consulting firm Mercer, which surveyed 569 companies across various industries in Indonesia.
“While automation and artificial intelligence create and alter jobs, [employers] are increasingly struggling to fulfill salary expectations and [labor] market value,” the company wrote in its press release received by The Jakarta Post on Dec. 30.
Mercer Indonesia's career business leader Astrid Suryapranata cited jobs in e-commerce, infrastructure as a service, cloud computing as well as automated robot configuration and programming as some of the new jobs found in the current labor market.
With such challenges, Mercer advised companies in a separate survey to go beyond salaries when investing in employee compensation, which ranges from career development opportunities, incentives and recognition.
“The change in how companies invest in their employees will give a bigger return to its business in the future,” said Puneet Swani, Mercer’s senior partner and career business leader for the international region, as quoted by its press release.
Both the Indonesian Employers Association (Apindo) and the Indonesian Chamber of Commerce and Industry (Kadin) members said that rising wages and automation adoption would contribute to the decline in recruitment in 2020, adding that these were just two of numerous other factors that had discouraged employers from hiring more people. They also offered different solutions to the issue.
