Summary: This article analyzes the dynamics of Indonesia’s labor market at the end of 2025, highlighting the growing disconnect between the intensity of government economic stimulus policies and the persistently low public optimism toward employment opportunities. Drawing on the Labor Availability Index (IKLK), which stood at 92, well below the neutral threshold of 100, the study reveals that despite a series of government interventions, such as the National Internship Program, tax incentives under the PPh 21 Government-Borne scheme, social insurance subsidies for informal workers, cash-for-work initiatives, and regulatory reforms through Government Regulation No. 28/2025, public sentiment remains pessimistic. The analysis indicates that most of these programs are short-term and focus primarily on cost reduction rather than stimulating aggregate demand that could generate sustainable employment. Consequently, the immediate benefits are limited to direct recipients, while broader structural effects on national job creation remain marginal. High levels of educated unemployment and the predominance of informal employment further reinforce this pessimism. The paper argues that rebuilding labor market confidence requires more coherent, integrative, and long-term strategies, including expanded vocational training, increased labor-intensive investment, effective local deregulation, and the transformation of social welfare programs into instruments of productive empowerment. Such policies are essential for establishing an inclusive, adaptive, and sustainable employment foundation for Indonesia’s economic future.
Introduction
Indonesia’s employment landscape toward the end of 2025 reflects a complex and multifaceted challenge. On one hand, the government has introduced a range of fiscal and social stimulus policies designed to expand job opportunities and reinvigorate national economic activity. On the other hand, indicators of public sentiment show that optimism regarding job availability remains stagnant. This contradiction exposes a policy gap between macroeconomic intentions and micro-level realities, suggesting that state interventions have yet to translate into sustained, structural job creation.
The Labor Availability Index (IKLK), a key indicator of public perception in Indonesia’s consumer survey, underscores this stagnation. By September 2025, the index registered at 92, significantly below the neutral point of 100, indicating that more respondents perceived fewer job opportunities compared to previous months. Since May 2025, the index has consistently remained in the pessimistic zone. This sustained decline demonstrates the limited efficacy…
