Other BriefingsIndonesia’s Minimum Wage Rates for 2024
Minimum wage regulations in Indonesia are set at the provincial or district level, rather than being uniform across the entire country. This decentralized approach reflects the diverse economic conditions and living costs across different regions of Indonesia. As a result, foreign businesses operating in multiple locations within Indonesia need to be aware of and comply with the specific minimum wage requirements in each area where they operate.
|
Province |
Monthly minimum wage rate (rupiah) |
|
Aceh |
3,460,672 (US$222) |
|
North Sumatra |
2,809,915 (US$180) |
|
West Sumatra |
2,811,449 (US$180) |
|
Riau |
3,294,625 (US$211) |
|
Riau Islands |
3,402,492 (US$218) |
|
Jambi |
3,037,121 (US$195) |
|
South Sumatra |
3,456,874 (US$221) |
|
Bangka Belitung |
3,640,000 (US$233) |
|
Bengkulu |
2,507,079 (US$161) |
|
Lampung |
2,716,497 (US$174) |
|
Banten |
2,727,812 (US$175) |
|
DKI Jakarta |
5,067,381 (US$325) |
|
West Java |
2,057,495 (US$132) |
|
Central Java |
2,036,947 (US$130) |
|
Special Region of Yogyakarta |
2,125,897 (US$136) |
|
East Java |
2,165,244 (US$139) |
|
Bali |
2,813,672 (US$180) |
|
West Nusa Tenggara |
2,444,067 (US$157) |
|
East Nusa Tenggara |
2,186,826 (US$140) |
|
West Kalimantan |
2,702,616 (US$173) |
|
South Kalimantan |
3,282,812 (US$210) |
|
Central Kalimantan |
3,261,616 (US$208) |
|
East Kalimantan |
3,360,858 (US$215) |
|
North Kalimantan |
3,361,653 (US$215) |
|
Maluku |
2,949,953 (US$189) |
|
North Maluku |
3,200,000 (US$205) |
|
Gorontalo |
3,025,100 (US$194) |
|
North Sulawesi |
3,545,000 (US$227) |
|
Southeast Sulawesi |
2,885,964 (US$185) |
|
Central Sulawesi |
2,736,698 (US$175) |
|
South Sulawesi |
3,434,298 (US$220) |
|
West Sulawesi |
2,914,958 (US$187) |
|
Papua |
4,024,270 (US$258) |
|
West Papua |
3,393,000 (US$217) |
How is the minimum wage increase calculated?
MOM 18/2022 stipulated a new formula for calculating the minimum wage increase. The calculation for the minimum wage took into account Indonesia’s economic growth, inflation, and the contribution of employees to economic growth.
The formula is as follows:
UM (t+1) = UM (t) + (Adjustment of UM value x UM (t))
Where,
- UM (t+1) = the minimum wage to be determined; and
- UM (t) = the current minimum wage.
Further,
The following equation is used to find the figure of the adjustment of the UM value from the above formula.
Adjustment of UM value = Inflation + (EG x α)
- Inflation = refers to provincial inflation from September last year to September this year.
- EG = economic growth; and
- α = an index that describes the contribution of labor to economic growth, valued at a range of between 0.10 and 0.30.
Hourly wages for part-time workers
Indonesia has sought to reform its labor laws through the Omnibus Law and has since abolished the sectorial minimum wage through Government Regulation 36 of 2021 — an implementing regulation of the Omnibus Law — and introduced an hourly wage for part-time workers.
The formula for determining the hourly wage is as follows:
Hourly wage = Monthly wage/126
To calculate the daily wage:
Six working days/week
Daily wage = Monthly wage/25
Five working days/week
Daily wage = Monthly wage/21
The employer and employee are allowed to set their agreement, but the final salary should not be lower than the calculation using the aforementioned formulas.
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