Indonesia Create Inclusive Jobs, Even in Remote Areas
By: Deka Prawira
The government is further strengthening its job creation strategy through various concrete breakthroughs that directly address the needs of businesses and communities in the regions. These efforts are evident in the launch of the Labor-Intensive Industrial Credit (KIPK) financing scheme, the optimization of national priority programs such as the Red and White Village/Sub-district Cooperative and Free Nutritious Meals, and cross-ministerial collaboration to increase employment for vocational school graduates by strengthening the role of the Special Job Exchange (BKK). All of these initiatives are crucial steps towards realizing an inclusive economy and encouraging the creation of decent jobs, even in remote villages.
The launch of KIPK is a strong signal that the government is not remaining silent in the face of global challenges impacting the domestic industrial sector. This financing scheme specifically targets labor-intensive businesses, namely sectors that employ a large workforce, and provides access to low-interest credit to enable modernization of production equipment without burdening business actors. The government hopes that through this policy, industrial players will not only survive global market pressures but also be able to thrive and create more job opportunities.
Ferry Irawan, Deputy for Coordination of Management and Development of State-Owned Enterprises at the Coordinating Ministry for Economic Affairs, is one of the officials actively monitoring the effectiveness of this program. Ferry visited the national furniture industry centers in Jepara Regency, namely PT Talenta Java Design and CV Garden Nia Jaya. Both companies are known as furniture exporters and make significant contributions to local employment.
In Ferry’s opinion, external challenges, such as the reimposition of trade tariffs by the United States on furniture products from Asia, including Indonesia, have been a significant blow to the national industry. This situation requires industry players to not rely solely on a single export market but to diversify their markets and improve product efficiency and quality. He believes that the KIPK (Finance Savings Program) is a concrete solution to provide more flexible financing opportunities so that industry players can adapt quickly to these dynamics.
The KIPK scheme itself is regulated by Regulation of the Coordinating Minister for Economic Affairs Number 4 of 2025 and is an integral part of the MSME Financing Committee’s policy. Its focus is clear: providing easy financing to labor-intensive businesses so they can increase productivity while maintaining competitiveness. Ferry stated that the government’s presence in policies like this is not merely a short-term response, but rather a long-term commitment to ensuring the sustainability of industry and employment amidst global challenges.
The government’s strategy to expand employment opportunities goes beyond the industrial sector; it also targets local communities through national priority programs. Noudhy Valdryno, Deputy for Dissemination and Information Media at the Presidential Communications Office (PCO), stated that programs such as the Red and White Village/Sub-district Cooperative and Free Nutritious Meals are expected to have a multiplier effect on the local economy, particularly by opening access to decent work outside of large cities.
According to Noudhy, President Prabowo Subianto’s mission emphasizes the importance of equalizing employment opportunities even in remote villages. The Red and White Village Cooperative, for example, is believed to be a key driver of the economy from the bottom up, creating new job opportunities, especially for young people in rural areas. With this program, it is hoped that young people will no longer need to migrate to cities just to earn a living. Job opportunities close to home not only strengthen the local economic structure but also reduce the burden of urbanization.
Furthermore, Noudhy emphasized that the jobs generated by these priority programs will focus on the quality and capacity of the workforce, in accordance with their educational background. This way, the government will not only focus on the quantity of jobs but also ensure that these jobs are decent and align with skills. The hope is that income will be distributed more evenly across Indonesia.
Meanwhile, a collaborative approach between ministries is also a crucial strategy adopted to increase employment, particularly for vocational high school (SMK) graduates. Minister of Manpower Yassierli emphasized the importance of a new approach to job creation. He stated that simply connecting basic elements such as education and industry is not enough; more involvement from various sectors is needed to create a real, comprehensive solution.
