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Indonesia sets max of 10% wage hike next year

Indonesia has set a maximum of 10% for wage increases next year, which is smaller than what labour unions had demanded. The Ministry of Manpower said that minimum wages across Indonesia will rise by a maximum of 10% in 2023 based on a certain formula. Minister Ida Fauziyah hopes that with the adjustment of the 2023 minimum wage formula, people’s purchasing power and consumption will be maintained, and it can still increase economic growth and will eventually create jobs. Unions had urged the government to use a previous rule that would pave the way for at least a 13% increase and also made a case for a 25% jump citing double-digit food, fuel, and housing inflation. The Confederation of Indonesian Trade Unions had threatened a protest march by five million workers if its demand wasn’t met.

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