Opening Remarks at the Launch of the Indonesia Jobs Outlook 2017: Harnessing technology for growth and job creation

By Michiko Miyamoto, Director of ILO for Indonesia and Timor-Leste at the Launch of the Indonesia Jobs Outlook 2017: Harnessing technology for growth and job creation

Statement | Jakarta, Indonesia | 14 December 2017
I would like to welcome you all to mark the launch of the Indonesia Jobs Outlook 2017. As many of you may already know, in the past we have periodically published the Labour & Social Trends Report on Indonesia. This year we decided to change the title to better reflect the content of the report.

The global economy and the world of work is being shaped by several forces. Climate change, migration, relatively low demand, and rapid technological changes. In 2013, the Director General of the International Labour Organization (ILO) launched the Future of Work initiative to help member states to grapple with the issue of technology and its impact on jobs.

In Indonesia, ILO has also initiated a dialogue on the future of work. As part of this process, the Government of Indonesia in partnership with ILO organized two national dialogue to explore policy responses.

The Indonesia Jobs Outlook 2017 which this year focuses on technology and employment aims to feed this dialogue.

Through this report, we wanted to understand the changes in labour market and how technology is affecting this process. As you know, the relationship between technology and jobs is quite complex and it is not easy to see the “cause and effect” relationship clearly. There are far too many variables. This report is, therefore, a modest attempt to synthesize current thinking on this subject.

As the title of the theme “Harnessing Technology for Growth and Job Creation” suggests we see technology as an opportunity which can be used as a catalyst for creating better jobs and productivity. As the report highlights, technology and jobs always had a symbiotic relationship. In the past, technological change over time led to new jobs and industries.

However, technology can no doubt be disruptive. History has shown that. Use of new technology in the production process has usually meant that jobs are lost, at least in the short to medium term.

The concern with the present technological change is the pace at which it is happening. Also, it is happening when the global economy is not growing as fast as it did before the 2008 global financial crisis.

For this report, we have tried to draw from various analytical papers that have looked into jobs and technology. Also, we looked at data from several surveys including those ILO has conducted in Indonesia and ASEAN to understand how firms perceive technology and its impact on the production processes.

Overall, our trend analysis of the labour and employment situation in Indonesia shows many positive developments. Indonesia has made noticeable improvements. Many more workers are now engaged in productive employment. Unemployment rate has fallen significantly. We also see positive changes in terms of education background of workers.

But, as we often say, low unemployment, especially in developing countries can disguise decent work deficits. Although decreasing there are still many workers in vulnerable employment and informal employment. There are gender gaps in the form of wage differentials; more men are involved in higher productivity occupations.

In other words, while Indonesia has achieved much, there is still a lot more to do. In this regard, I hope this report helps to shape the economic and employment policy landscape.

Lastly, I look forward to continue the work with our national stakeholders as well as international development partners to promote job creation and decent employment in Indonesia.