In reality, annual farmworker wages only increased by 1.16%.

The Central Statistics Agency recorded that the nominal wage of farm laborers in June 2018 increased by 0.28% to Rp 52,200/day, while inflation in the same month reached 0.59%. As a result, the real wage of farm laborers decreased by 0.04% to Rp 37,830/day. This means that although the nominal wage received by farm laborers increased, it actually decreased in real terms.

From June 2017 to June 2018, the farm laborers' wages increased by 4.58%, while the inflation rate in June 2018 compared to June 2017 reached 3.12% (YoY). Therefore, in real terms, the wages of farm laborers did not change significantly, only increasing by 1.16%. This means that although there was a nominal increase, the real wage of farm laborers in the last year only recorded a growth of 1.16%.

Real wages are a comparison between nominal wages and the household consumption index. Changes in real wages reflect the purchasing power of the income received by workers. The higher the real wage, the higher the economic capacity, and vice versa. Nominal wages, on the other hand, are the average daily wages received by laborers as compensation for work performed. Although nominal wages show an increase, this figure does not necessarily reflect the welfare of laborers.