The formula of minimum wage increment 2018 in Indonesia

October 13, 2017 The Ministry of Manpower (Kemnaker) has officially set the increase in Provincial Minimum Wage (UMP) by 8.71 percent. This is stated in the Ministry of Manpower's Circular Letter dated 13 October 2017, with No. B.337 / M.NAKER / PHIJSK-UPAH / X / 2017 on Submission of Data on National Inflation Rate and Gross Domestic Product Growth of Indonesia for the Year 2017.

Based on this, the increase in the Provincial Minimum Wage (UMP) 2018 has been in accordance with the formula of minimum wage increment stipulated in Government Regulation No. 78 of 2015 on Wages namely the total sum of economic growth and inflation.

While data for inflation and national economic growth (gross domestic product growth) to calculate the minimum wage in 2018 using data sourced from the Central Bureau of Statistics (BPS) of the Republic of Indonesia, in accordance with the Letter of BPS Head No. B-188 / BPS / 1000/10 / 2017 dated October 11, 2017, "which was stated in a Circular Letter of Fire, Monday (30/10).

BPS RI has set national inflation of 3.72 percent. Meanwhile, the national economic growth of 4.99 percent. So if both components are added up will be equal to 8.71 percent.

Furthermore, the formula for calculating the size of UMP 2018 is the amount of UMP 2017 coupled with the multiplication result between the size of UMP 2017 x (inflation rate + national economic growth) which is in accordance with Article 44 Paragraph 1 and Paragraph 2 of PP Number 78 Year 2015. , then obtained the amount of UMP 2018 for in each province that is UMP 2017 + (UMP 2017 x 8,71 percent).

For example, DKI Jakarta's UMP 2017 amounts to Rp 3,355,750. Thus, the UMP is multiplied by 8.71 percent, then the result is Rp 292,285. That is, UMP 2018 DKI Jakarta reached Rp 3,355,750 + Rp 292,285 to Rp 3,648,035.