Government Employee Spending Contribution to GDP Shrinks 2018-2023

Economics & Macro

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Adi Ahdiat 21/10/2024 14:50 WIB

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According to BPS data, the value of government employee compensation (civil servants/military/police) has steadily increased from 2018 to 2023. However, its contribution to GDP has decreased.

Government Employee/Civil Servant/Military/Police Compensation Spending and its Contribution to Indonesia's GDP (2018-2023)

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Government Employee/Civil Servant/Military/Police Compensation Spending and its Contribution to Indonesia's GDP (2018-2023)

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Government employee compensation spending (civil servants/military/police) has steadily increased in recent years. However, its contribution to the Gross Domestic Product (GDP) has shrunk.

This is recorded in a report by the Central Statistics Agency (BPS) titled *Indonesia's General Government Balance Sheet 2018-2023*.

BPS calculates the value of government employee compensation from all realized employee expenditure accounts in the State Budget (APBN), plus salary and allowance expenditures for employees sourced from goods expenditure.

This value of government employee compensation includes:

1. Salaries and allowances for civil servants/military/police (including holiday allowances, absence allowances due to illness, cost of living allowances, etc.);
2. Honorariums/overtime/vacation/special allowances (including rice, sugar, side dishes, uniforms, housing, etc.); and
3. Social contributions (including contributions for pension assistance, family assistance, accident insurance, health insurance, life insurance, etc.).

In 2018, the value of government employee compensation spending reached Rp767 trillion, equivalent to 5.17% of the total GDP at current prices at that time.

Then, the spending gradually increased to Rp889 trillion in 2023. However, its contribution to GDP fell to 4.25%.

"Although the role of government employee compensation in creating gross value added or national GDP is not yet large enough, employee expenditure is one type of expenditure that plays an important role in driving the growth of government consumption expenditure," said BPS in its report.

Editor : Adi Ahdiat

"Disclosure: This is an AI-generated translation of the original article. We strive for accuracy, but please note that automated translations may contain errors or slight inconsistencies."

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Government Employee Spending Contribution to GDP Shrinks 2018-2023

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