According to data from the National Industrial Information System for the first half of 2025, 1,641 companies are building new production facilities, with an investment value of IDR 803.2 trillion, expected to absorb 3.05 million workers. In June 2025, manufacturing production showed an expansion trend, with the Industrial Confidence Index at 52.50, indicating that over 50% of industrial enterprises performed better than the previous month and labor demand increased. The Industrial Confidence Index for export-oriented industries and domestic market-oriented industries were 52.19 and 51.32 respectively, both showing expansion, meaning that demand, production, and employment in manufacturing are better than previous periods. The spokesperson for the Ministry of Industry is optimistic about the employment prospects of the manufacturing sector because the government has issued a Minister of Trade Regulation, an amendment to the import relaxation policy. Although this policy has only been in effect for two months, it has already stimulated domestic industries, especially those oriented toward the domestic market, and is expected to control the quantity of low-priced imported products, improve production utilization rates and the employment absorption capacity of labor-intensive industries. The Ministry of Industry has completed coordination with relevant agencies on a draft Minister of Industry Regulation regarding credit for labor-intensive industries, which will be issued simultaneously with a Minister of Finance Regulation. About 2,722 labor-intensive industrial enterprises are expected to benefit from this, helping companies avoid layoffs, increase production utilization rates, and improve product competitiveness.
Two historic trade agreements between Indonesia and the United States and the European Union have stimulated the vitality of domestic industries, especially export-oriented industries. Some companies originally focused on the domestic market have started to export products to the U.S. and European markets. The increase in export demand and production utilization rates will help protect employment and absorb more labor, as well as open up larger European markets for Indonesia's export industries, while also attracting domestic market-oriented industries to engage in export business. The Ministry of Industry will increase the supply of manufacturing products to meet government demand through reforms in Local Content Level (TKDN) management. After the reform, TKDN calculation will be simpler, faster, and more efficient. High TKDN scores will increase opportunities for domestic products in government procurement, strengthen demand for local industries, and improve production utilization rates and employment absorption. Currently, about 3.2 million Indonesians are employed in domestic industries supplying government products, and this number is expected to rise further after the reform. He refuted the claim that the manufacturing sector is being hit by massive layoffs, arguing that layoffs should be viewed objectively based on accurate data, comprehensive analysis, and explanations, and stated that the manufacturing sector is continuously growing. During a visit to Japan, the Minister of Industry directly requested that Japanese automotive industry leaders avoid layoffs when optimizing efficiency, in order to support Indonesia's economic growth. The Ministry of Industry calls on all parties to release balanced information and analysis to maintain the investment climate, especially for domestic manufacturing investment, and to avoid unnecessary social panic.
行业快讯
Indonesia's Manufacturing Investment Surges, Employment Prospects for Over 3 Million People Improve
According to data from the National Industrial Information System for the first half of 2025, 1,641 companies are building new production facilities, with an investment value of IDR 803.2 trillion, expected to absorb 3.05 million workers. In June 2025, manufacturing production showed an expansion trend, with the Industrial Confidence Index at 52.50, indicating that over 50% of industrial enterprises performed better than the previous month and labor demand increased. The Industrial Confidence Index for export-oriented industries and domestic market-oriented industries were 52.19 and 51.32 respectively, both showing expansion, meaning that demand, production, and employment in manufacturing are better than previous periods. The spokesperson for the Ministry of Industry is optimistic about the employment prospects of the manufacturing sector because the government has issued a Minister of Trade Regulation, an amendment to the import relaxation policy. Although this policy has only been in effect for two months, it has already stimulated domestic industries, especially those oriented toward the domestic market, and is expected to control the quantity of low-priced imported products, improve production utilization rates and the employment absorption capacity of labor-intensive industries. The Ministry of Industry has completed coordination with relevant agencies on a draft Minister of Industry Regulation regarding credit for labor-intensive industries, which will be issued simultaneously with a Minister of Finance Regulation. About 2,722 labor-intensive industrial enterprises are expected to benefit from this, helping companies avoid layoffs, increase production utilization rates, and improve product competitiveness.
Two historic trade agreements between Indonesia and the United States and the European Union have stimulated the vitality of domestic industries, especially export-oriented industries. Some companies originally focused on the domestic market have started to export products to the U.S. and European markets. The increase in export demand and production utilization rates will help protect employment and absorb more labor, as well as open up larger European markets for Indonesia's export industries, while also attracting domestic market-oriented industries to engage in export business. The Ministry of Industry will increase the supply of manufacturing products to meet government demand through reforms in Local Content Level (TKDN) management. After the reform, TKDN calculation will be simpler, faster, and more efficient. High TKDN scores will increase opportunities for domestic products in government procurement, strengthen demand for local industries, and improve production utilization rates and employment absorption. Currently, about 3.2 million Indonesians are employed in domestic industries supplying government products, and this number is expected to rise further after the reform. He refuted the claim that the manufacturing sector is being hit by massive layoffs, arguing that layoffs should be viewed objectively based on accurate data, comprehensive analysis, and explanations, and stated that the manufacturing sector is continuously growing. During a visit to Japan, the Minister of Industry directly requested that Japanese automotive industry leaders avoid layoffs when optimizing efficiency, in order to support Indonesia's economic growth. The Ministry of Industry calls on all parties to release balanced information and analysis to maintain the investment climate, especially for domestic manufacturing investment, and to avoid unnecessary social panic.