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Jakarta Post

A dull May Day

Today, most workers are more concerned about holding onto their jobs than about large pay raises, even if they struggle to make a living from one payday to the next.

Editorial board (The Jakarta Post)
Jakarta
Sat, May 3, 2025 Published on May. 2, 2025 Published on 2025-05-02T17:16:20+07:00

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A dull May Day Workers wave to the camera on Feb. 28 as they leave a factory of textile giant PT Sri Rejeki Isman (Sritex) in Sukoharjo, Central Java. Sritex ceased operations on March 1 after being declared insolvent by the Semarang Commercial Court. (Antara/Mohammad Ayudha)

For many, there was not much to celebrate on May Day this year.

The general mood on factory floors and offices around the country is somber as concerns about mass layoffs, a lack of competitiveness and accelerating automation are all too present in employees’ minds.

A recent stream of incessant news reports about factory closures, ranging from textile giant Sritex and shoemakers for global brands, to piano builder Yamaha and electric equipment maker Sanken, are eating away at workers’ confidence, raising concerns about the financial security of their families.

The government, true to form for this administration, has created a task force to address layoffs and other employment issues, but workers remain wary as to whether or not it will address the underlying issues.

The task force was announced by the President on Thursday as he addressed hundreds of thousands of workers rallying to mark May 1 at the National Monument (Monas) in Central Jakarta.

The task force would prevent arbitrary dismissals and ensure that companies adhere to fair labor practices, prompting business groups on the same day to express concern that employers may be criminalized for management decisions.

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Such a task force might prevent the odd layoff here or there, but it might also keep companies from hiring more than the bare minimum, as they worry about being able to again reduce headcount if needed.

Maybe this is one of those problems for which there is no solution, at least not on the national level, because even solid economic growth does not guarantee solid employment growth.

We certainly must encourage more investment, both from home and abroad, to drive economic activity, but that could still prove insufficient to create enough proper jobs.

New investors who may be interested in taking over the assets of bankrupt textile firms, for instance, will bring with them new technology to produce the same or even more output with a much smaller workforce.

The so-called lights-out factories in China show us how to play in the global top league of mass manufacturing. We can bring back production, but the jobs are gone.

The same is true for other sectors. Massive efficiency gains wait to be realized in our agriculture and fisheries industries.

By conducting structural reforms and bringing technology to bear, we could make more competitive products to increase our exports or substitute imports, but at the price of making redundant a vast share of the current workforce in those sectors.

If the policy choice is between losing jobs in uncompetitive industries or making industries competitive by slashing jobs, then employees get the short end of the stick either way.

Little wonder, then, that the mood among the workforce is subdued.

A decade or so ago, unions emboldened by their bargaining power would demand minimum wage hikes of 20 percent or more. For 2025, they accepted a 6.5 percent increase without much grumbling.

Here is the lead paragraph of a story published by this paper 11 years ago: “Thousands of workers have demanded that the minimum wage be increased 30 percent starting next year. During Labor Day rallies on Thursday, workers presented a list of 'Ten Public Demands', among them pay increases.”

Today, most workers, whether unionized or not, whether in a factory or an office, or in a government ministry, are more concerned about holding onto their jobs than about large pay raises, even if they struggle to make a living from one payday to the next.

Instead of joining rallies and thrusting their fists up, they stay at their workplaces and keep their heads down.

To some degree, this has been a recurring theme around the world at times of economic downturn.

But there is a widespread feeling that the current pace of technological progress, where automation is amplified by artificial intelligence, is not just a matter of waiting for new jobs to spring up in new industries.

When machines produce machines and programs program programs, there is fear in the air about just how redundant we might be. In that context, one thing is perhaps more relevant than ever: Workers of the world, unite!

 

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