JAKARTA, Indonesia (MNTV) — Indonesia’s labor market has come under growing pressure as a string of major companies across the textile, footwear, electronics, digital, manufacturing, and media sectors have announced mass layoffs since 2025, despite the country’s economy continuing to expand at a robust pace, reports Jakarta Globe.
The wave of layoffs comes even as Indonesia’s economy grew 5.61% year-on-year in the first quarter of 2026, following 5.11% growth in 2025.
Manpower Ministry statistics show layoffs have continued to rise over the past three years. The number of workers affected increased from 64,855 in 2023 to 77,965 in 2024 and 88,519 in 2025.
Between January and May 2026, another 23,470 workers lost their jobs, bringing the cumulative total since 2023 to at least 254,809.
West Java recorded the highest number of layoffs during the first five months of 2026, with 5,044 workers, accounting for about 21.5% of all reported job losses.
Banten, East Java, South Kalimantan, East Kalimantan, Jakarta, and Central Java also recorded significant layoffs, highlighting mounting pressure on Indonesia’s industrial and manufacturing hubs.
Economist Achmad Nur Hidayat of UPN Veteran Jakarta said the trend raises concerns about the quality of Indonesia’s economic growth.
“Economic growth of 5.61% cannot be considered healthy if the number of workers losing their jobs continues to increase,” he said.
Achmad said the layoffs reflected deep structural challenges, including bankruptcies, weakening export demand, factory closures, production relocation, rising operating costs, corporate restructuring, and post-merger integration.
He warned that prolonged job losses could eventually weaken household consumption, the largest contributor to Indonesia’s economic growth, raising questions about whether the country’s strong headline GDP growth is translating into broader economic well-being.
Major layoffs
Sritex Group: 10,965 workers laid off after the textile giant was declared bankrupt in March 2025
Feng Tay Indonesia Enterprises: Around 4,000 footwear workers placed on leave in June 2026 as the company awaited new production orders
Victory Chingluh Indonesia: 1,800 workers laid off in October 2025 following export product returns linked to quality issues
Adis Dimension Footwear: 1,500 jobs eliminated in 2025 as part of cost-cutting measures
Yamaha Music Indonesia: Closure of two piano factories in 2025 affecting about 1,100 workers
Sumber Graha Sejahtera (SGS): Around 1,000 employees dismissed in June 2026 due to weakening global plywood demand
Multistrada Arah Sarana (Michelin): About 370 workers laid off in October 2025 as higher US import tariffs and slowing global demand weighed on exports
Media industry: Hundreds of jobs reportedly cut at Kompas TV, CNN Indonesia TV, tvOne, Emtek Group, MNC Group, and state broadcasters RRI and TVRI amid restructuring and government budget austerity.