Indonesian Workers Protest in Jakarta Over Minimum Wage Delays

Hundreds of Indonesian workers joined protests in Jakarta today to urge the government to roll back increases in electricity and gas prices that they say are stalling efforts to introduce higher minimum wages.

The energy ministry raised electricity tariffs by 15 percent starting Jan. 1 to help cut subsidy costs by 14 trillion rupiah ($1.45 billion). The increase has prompted companies to delay the implementation of higher minimum wages, Subiyanto, secretary general of the Confederation of Indonesian Labour Union, said today in an interview in Jakarta.

“We demand the government cancel the increase in electricity and gas tariffs because it will hurt workers,” Subiyanto said. “Companies have been postponing minimum wage increases because of higher electricity tariffs.”

Jakarta Governor Joko Widodo last year approved a 44 percent increase in minimum wages for workers in Jakarta to 2.2 million rupiah a month. Indonesian consumer stocks including PT Gudang Garam and PT Ramayana Lestari Sentosa rallied in the days after the decision on speculation higher wages would boost consumer spending.

To contact the reporter on this story: Fitri Wulandari in Jakarta at fwulandari@bloomberg.net

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net