Jokowi’s second year: Mind the quality of growth

Ayomi Amindoni

The Jakarta Post

While President Joko “Jokowi” Widodo has managed to boost economic development within two years after taking office, an issue becoming increasingly relevant is the quality of economic growth.

Central Statistics Bureau (BPS) data show that the main indicators of economic development, such as poverty, inequality and unemployment as well as inflation and economic growth, are slightly improved in 2016.

During Jokowi’s administration, the unemployment rate hit its lowest level in February 2016, with only 7.02 million unemployed people, 5.5 percent of the country’s workforce of 127.8 million.

That figure represents an improvement over the 7.45 million registered unemployed people in February 2015, equaling 5.8 percent of the workforce of 128.3 million at the time.

However, Samuel Asset Management economist Lana Soelistianingsih pointed out another problem that needed taken care of, namely increased under-employment due to lay-offs and reduced working hours amid a sluggish economy.

“Our real sector is still panting. While our workforce is growing in quantity, the quality has yet to be improved,” she said on Tuesday in Jakarta, recommending improvements in workforce skills by revitalizing vocational training centers.

Without appropriate measures, under-employment may put in jeopardy recent achievements. These include a decline in poverty from 28.51 million, or 11.22 percent of Indonesia’s population, in March 2015 to 28.01 million people, or 10.86 percent, a year later.

Likewise, the gini coefficient, an indicator measuring income inequality, where zero expresses perfect equality, declined to 0.397 in March 2016 from 0.408 in the previous year. This indicates that income inequality in the country has narrowed. (ags)