Indonesia recorded 32,389 layoffs during the first half of 2026, with the manufacturing slowdown and weakening business conditions continuing to weigh on employment, according to data from the country's Ministry of Manpower.
Figures published through the ministry's Satu Data Kemnaker platform showed that West Java accounted for 6,727 layoffs, representing 20.77% of the national total between January and June. Banten recorded the second-highest number of job losses at 3,782, followed by East Java with 2,851.
The ministry said the data only covers workers enrolled in the Job Loss Insurance (JKP) programme. Employees who resigned voluntarily, retired, became permanently disabled or died are excluded from the figures under Government Regulation No. 6/2025 and Manpower Ministerial Regulation No. 2/2025.
However, Presidential Special Advisor for Labour and Workers' Welfare Said Iqbal argued that the actual number of layoffs is likely to be significantly higher, saying many job cuts are not captured in the government's database.
Iqbal, who also serves as president of the Confederation of Indonesian Trade Unions (KSPI) and chairman of the Labour Party, said numerous layoff cases fall outside the official reporting mechanism.
Responding to the rise in job losses across Indonesia, Deputy Manpower Minister Afriansyah Noor said President Prabowo Subianto had established a Layoff Task Force to prepare for a potential wave of redundancies amid ongoing global geopolitical and economic uncertainty.
Afriansyah also stressed the importance of stronger collaboration between employers and labour unions to maintain healthy industrial relations and mitigate workforce disruptions.
The layoff figures come as broader economic indicators point to continued weakness in Indonesia's labour market.
A Bank Indonesia business survey showed employment continued to contract in the second quarter, with the labour utilisation index slipping to 48.65 from 48.76 in the previous quarter. Although the central bank expects the index to improve slightly to 49.7 in the third quarter, it remains below the 50-point threshold that separates expansion from contraction.
Meanwhile, S&P Global's Indonesia Manufacturing Purchasing Managers' Index (PMI) fell sharply to 46.9 in June, down from 50 in May, signalling renewed deterioration in manufacturing activity.
The decline was driven by weaker new orders, with businesses reporting softer domestic demand as persistent price pressures eroded consumer purchasing power. Export orders also recorded their steepest decline since August 2021, as rising costs reduced the competitiveness of Indonesian goods in overseas markets.
Analysts at Samuel Sekuritas Indonesia expect manufacturing conditions to remain under pressure in the near term, citing sluggish domestic demand, elevated production costs, weaker export orders and subdued business confidence amid continued global uncertainty and rupiah depreciation.
Earlier this year, Said warned that rising production costs linked to the Iran conflict had forced several manufacturers across Java to scale back or shut down operations. He estimated the closures could result in around 9,000 additional layoffs across 10 companies in Banten, West Java, Central Java and East Java.
The latest figures differ from an earlier ministry statement in late June that cited around 43,000 layoffs in the first half of the year, as Iqbal also suggested. The latest Satu Data Kemnaker figures cover only workers enrolled in the Job Loss Insurance (JKP) programme.