Heaptalk, Jakarta — Indonesia’s Minister of Manpower Yassierli officially signed the Regulation of the Minister of Manpower Number 16 of 2024 concerning the Determination of the 2025 Minimum Wage. The regulation mandates a 6.5% increase in the Provincial Minimum Wage (UMP) and Regency/City Minimum Wage (UMK), effective January 1, 2025.
“This UMP must be implemented for workers with less than one year of service,” Yassierli stated during a press conference held at the Ministry of Manpower’s office in Jakarta.
The 2025 UMP is calculated by adding the current year’s UMP to the 6.5% increase. The adjustment considers economic growth, inflation, and specific indices. Meanwhile, the UMK formula follows a similar approach, with the 2025 UMK equaling the 2024 UMK plus a 6.5% increase.
The regulation also addresses Sectoral Minimum Wages (UMS) for industries with distinct characteristics, higher risk levels, or specialized job demands. The UMS for a sector must exceed the UMP or UMK of the respective region:
- Provincial UMS: Recommended by the Provincial Wage Council and established by the Governor.
- Regency/City UMS: Recommended by the Regency/City Wage Council and determined by the Governor through local authorities.
Establishing UMS requires agreements from the respective wage councils and must ensure sectoral minimum wages remain higher than the general minimum wages for the same region. Regarding the implementation timeline, UMP and Provincial UMS must be determined by gubernatorial decree and announced no later than December 11th, 2024. Meanwhile, for UMK and Regency/City, UMS must be finalized by a gubernatorial decree and announced no later than December 18th, 2024.
This wage increase reflects a balanced approach to sustaining workers’ livelihoods while supporting economic growth. It ensures wage adjustments align with inflationary pressures and financial conditions, offering equitable benefits for workers and businesses across Indonesia.
