Jakarta (VNA) – Despite being in a demographic golden period, Indonesia continues to struggle with low labour productivity, prompting calls for clear and sustainable reforms.
According to data from Indonesia’s Statistics Agency (BPS), the country now sees 70.1% of the population of working age and the labour force reaching 152.1 million people last year. The rare period offers strong potential for accelerated economic growth.
However, this demographic potential is being undermined by persistently low labour productivity. In 2023, average labour output stood at just 15.12 USD, far behind Malaysia’s 29.67 USD and the Republic of Korea’s 48.57 USD. While Indonesia’s GDP has grown at an average rate of 5% annually since 2015, labour productivity has only risen by 2.5% per year.
The nation is also grappling with several structural barriers that hamper productivity growth. Only 13.5% of the workforce holds higher education qualifications. Additionally, the country faces an imbalanced employment structure, weak innovation capacity, and governance-related challenges.
Experts said to capitalise on the full benefits of its demographic window, a long-term, sustainable strategy is essential./.
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