Japan firms in Indonesia to increase pay at slower pace in 2020: NNA survey

22, Jan. 2020

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JAKARTA, NNA – Japanese firms operating in Indonesia are considering raising wages at a slower rate in 2020 as they cope with rising labor costs.

The average increase projected for 2020 is 6.6 percent for all industrial and service sectors, down from the 7.3 percent paid last year, according to the findings of a NNA survey.

Among the 199 companies that participated in the survey, 8 in 10 or 80.4 percent plan to pay increments, mostly in January and April.

Seven of the 15 sectors surveyed are expected to see a 6-7 percent increase while over a quarter of firms intend to raise salary by 7 percent or lower.

The majority of the companies or 75.1 percent cited rising wages as their main concern, followed by difficulty in recruiting talent.

The NNA poll was conducted from August to September last year.