Investment Climate Improved, Labor Force Absorption Increases Continually

The realization of Indonesian labor force absorption in the first quarter 2013 reaches 361,924 people. Head of Capital Investment Coordinating Board (BKPM) Chatib Basri stated, the labor force absorption in the first quarter consists of domestic investment (PMDN) project of 148,521 people and Foreign Investment (PMA) project of 213,403 people. According to Chatib, both PMDN and PMA are estimated to give double impacts indirectly on labor force absorption, namely 4 times.

He further stated, the volume of capital goods import experiences a decrease due to the economic crisis impact in Europe. Nevertheless, foreign investment and domestic investment continue to increase in overall. “Capital goods import is negative indeed, but domestic investment increases continually,” he said.

The realization of PMDN also experiences an increase in the first quarter 2013. Comparing to the figure in the same period in 2012 of 39.6 percent, it increases from IDR19.7 trillion to IDR27.5 trillion.

East Java becomes the most popular region for investors. BKPM records that capital in amount of IDR9 trillion has entered East Java during January – March 2013. It is followed by East Kalimantan of IDR4.8 trillion, South Kalimantan of IDR3.4 trillion, North Sumatera of IDR2 trillion and Jakarta of IDR1.9 trillion.

On the other side, PMA realization in the first quarter 2013 increases by 27.2 percent, compare to the same period in 2012. The realization figure has increased from IDR51.5 trillion to IDR65.5 trillion. In fact, this increasing figure of PMA may absorb 213,403 people or 58.96 percent from total figure of labor force. “Direct labor force absorption during the first quarter 2013 is 361.924 people. The highest absorption comes from PMA, namely 213,403 people or 58.96 percent out of the total number of Indonesian labor force,” he explained.


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