JAKARTA (ANN/THE JAKARTA POST) – The latest news about Indonesia’s youth is concerning, not only because the Education, Culture, Research and Technology Ministry has proposed higher university tuition fees, but also due to the revelation that nearly 10 million Gen Z individuals, aged 15 to 24, are unemployed.
These alarming statistics raise questions about the education system and job market. Are there insufficient jobs, or are young people underqualified? And if many lack the necessary skills, why increase education costs?
For the past five years, the unemployment rate for those aged 15-29 has remained high, according to Statistics Indonesia (BPS). In 2022, the unemployment rate for the 15-19 age group was 29.08 per cent, higher than during the onset of the COVID-19 pandemic in 2020 when it was 24.34 per cent. For the 20-24 age group, the unemployment rate was 17.02 per cent in 2022, down 1.69 per cent since the pandemic.
These figures are significantly higher than the annual average unemployment rate of 5 to 7 per cent, indicating much lower unemployment among other age groups.
Kompas daily recently reported that the high unemployment rate is partly due to the decreasing number of jobs in the formal sector. Between 2019 and 2024, the formal sector absorbed only 2 million workers, a sharp decline from 8.5 million jobs in 2014-2019 and 15.6 million in 2009-2014. Meanwhile, public university tuition fees have been rising by around 1.3 per cent annually.
This trend likely contributes to Gen Z unemployment. However, for the 15-19 age group, few formal sector jobs are available for those with only a high school education or less. Creating non-formal sector jobs that emphasise skills rather than university degrees might be more effective.
For the 20-24 age group, the government’s Merdeka Belajar Kampus Merdeka (Freedom to Learn, Independent Campus: MBKM) initiative, which includes significant internship efforts, may help reduce unemployment but not quickly enough.
Since 2015, Indonesia has claimed the demographic bonus, where the working-age population (15-64) outnumbers the non-working-age population, potentially boosting economic growth. However, this demographic dividend can become a disaster if the productive population fails to meet the required productivity levels.
One of the government’s significant challenges is to create jobs quickly enough for the growing young population. Failure to do so may lead to a surge in unemployment and economic decline.
Instead of focusing on mega infrastructure projects, the government should invest in education, especially programs that enhance young people’s skills for independent work. However, these plans must be executed carefully.
Despite initiatives like allocating 20 per cent of the annual state budget for education, developing vocational schools, and the MBKM, the government still struggles with efficiency, corruption, and the consequences of a growing young population.
A thorough review and careful planning in human development are crucial. Short-term measures like raising university tuition fees should be avoided. Effective planning and execution of youth development policies are essential to prevent a demographic disaster.
