In 2018, the government targeted an unemployment rate of 5.4%.

The Indonesian government, through the Head of the National Development Planning Agency (Bappenas), aims to reduce the open unemployment rate (OUR) to 5.4 percent in 2018. Last year, the unemployment rate reached 5.61 percent, and was targeted to decrease to 5.6 percent in 2017. This target is achievable, assuming economic growth is in the range of 5.4-6.1 percent with new entrants to the workforce less than 2 million in 2018. Furthermore, the target is to create 2.3-2.5 million new jobs in 2018.

To achieve this target, the government is implementing several breakthroughs in the labor sector. Firstly, increased investment and budget allocation will be focused on infrastructure development and economic sectors such as manufacturing. Secondly, labor-intensive industries will absorb unemployed and underemployed individuals, thereby reducing inequality and lifting people out of poverty. Finally, the service sector will also be a mainstay in providing formal employment, particularly economic activities utilizing information technology.

These development targets were presented by the Minister of National Development and Head of Bappenas at the Budgetary Board Meeting of the Indonesian House of Representatives (DPR-RI) on Tuesday, June 6th. All these targets are outlined in the 2018 Government Work Plan, taking into account various domestic and global macroeconomic conditions.