WITH the world economy in a state of flux, President Susilo Bambang Yudhoyono’s focus on job creation is both timely and strategic. Indonesia has done well economically over the past few years, but it would be foolish to grow complacent. The president has formed a dedicated team to tackle unemployment .... Despite the strong economic growth, unemployment is still high at above six per cent, which means that some six million Indonesians are still without work.

We welcome and support the president’s focus on job creation and maintaining the momentum for economic growth. The president wants to lower unemployment to below five per cent by 2014, which is achievable. But it will require empowering the private sector and creating a business-friendly environment so that more foreign investors park their money here.

To encourage companies to hire more workers, the government is willing to offer tax incentives and is mulling over the possibility of also offering fiscal incentives. Such initiatives will definitely be welcomed by entrepreneurs and businesses as it will help them lower labour costs. Apart from such incentives, another critical element is ensuring that companies have the flexibility to hire workers quickly but also to downsize when necessary. Without such flexibility, employers will be reluctant to hire large numbers of new workers.

The newly established taskforce must look at the labour market in a holistic manner. It must ascertain which industries have the potential to grow fastest and support the creation of new jobs. It must also communicate with labour unions so that strikes and sit-ins are minimised. If we are to create millions of new jobs, all stakeholders need to play their part.—(Dec 4)