Indonesia's pre-employment card programme, a social safety net offering aid similar to unemployment benefits, saw an immediate spike in interest within a few days of its launch, as 2.8 million people have lost their jobs nationwide as a result of businesses temporarily halting operations.

Just a day after the programme was launched on Saturday, 1.4 million people applied for benefits worth a total of 3.5 million rupiah ($220) – to be given for four months – in the first registration phase, data from the Office of the Coordinating Economic Minister shows.

The programme, which was part of President Joko ‘Jokowi’ Widodo’s campaign pledge, initially aimed at providing Indonesian workers the necessary skills training for work.

“Our objective is slightly shifting,” Denni Puspa Purbasari, the president director of the programme’s management, told an online talk show on Monday.

“We initially wanted to reduce youth unemployment, but now we are also focusing on furloughed workers, those who have lost their jobs or small entrepreneurs who have lost customers,” she said.

With a budget of 20 trillion rupiah, the programme will cover 5.6 million participants aged 18 years or above who are currently not attending university, particularly those who have yet to receive any social assistance.

As many as 2.8 million people have lost their jobs as of Monday, data from the Manpower Ministry and the Workers Social Security Agency shows. More than half were furloughed and placed on paid or unpaid leave.

Employment data from August last year shows that 7.05 million people are unemployed in Indonesia, representing a 5.28 per cent unemployment rate.

Centre of Reform on Economics Indonesia research director Piter Abdullah said: “The scope of the pre-employment card needs to be widened, eased and accelerated.

“With limited data, there’s a risk that disbursement will not be well-targeted – but it’s better than nothing. Therefore, it’s important that social aid is not politicised,” he said.

Many businesses have been laying off or furloughing workers as they temporarily shut down operations in line with the government’s large-scale social restriction measures to slow the spread of Covid-19.

Introduced earlier this month, the policy mandates the suspension of schools and offices, as well as religious and public activities, with only essential businesses allowed to operate.

Domestic factory activities have contracted to a record-low level in the first quarter of this year at 45.64 per cent, Bank Indonesia’s Prompt Manufacturing Index shows.

The Manpower Ministry’s training and productivity supervision director-general Bambang Satrio Lelono said: “Our employment conditions are very concerning.

“Therefore, we hope recipients [of the pre-employment card programme] can choose courses that will open up job opportunities, either in the same industry or a new one.

“They can use the training according to their needs or opportunities in the future job market. The programme can help them develop their own businesses,” he said.

Nearly 200,000 workers in tourism, which has by far been the hardest-hit industry by the outbreak, are set to apply for the programme, data from the Tourism and Creative Economy Ministry shows.

More than 1,200 hotels in 31 provinces have temporarily closed, according to the Indonesian Hotel and Restaurant Association (PHRI). Of those, 844 have registered their 74,100 employees with the pre-employment card programme.

“We’re worried that many hotels and restaurants don’t care enough to register their employees, but workers in this sector highly need the social aid,” PHRI chairman Hariyadi Sukamdani told a teleconferenced briefing on Wednesday. “Many hotels have yet to give us their employee data.”

Around 7,000 travel agents in the Association of Indonesian Tour and Travel Agencies (Asita) have been forced to take measures such as cutting salaries and furloughing workers in order to avoid layoffs, said Asita chairman Nunung Rusmiati.

“We are trying very hard not to lay off our workers, but we would struggle if we don’t cut their salaries.

“So, some of the measures we’re taking include cutting workers’ salaries by 50 per cent and giving them unpaid leave,” Nunung said at the same online event.

The pre-employment card programme offers 900 courses, including English for tour guides, accounting, information technology and business management, in partnership with eight institutions, such as online learning platform Skill Academy and e-commerce platforms Tokopedia and Bukalapak.

Eligible recipients who have registered at prakerja.go.id will receive their benefit via bank transfers or e-wallet platforms GoPay and LinkAja to ease the disbursement process.

THE JAKARTA POST/ASIA NEWS NETWORK