Indonesia has 44 million youths. It's struggling to get them jobs

Al Jazeera

18-07-2025

Medan, Indonesia – After graduating from university with a law degree two years ago, Andreas Hutapea assumed he would not have much difficulty finding a stable career.
In reality, Hutapea found himself facing one rejection after another.
Hutapea first failed to make it through Indonesia's notoriously difficult civil service exams, which lead to a job for only about 3 percent of applicants, and was similarly unsuccessful in his bid to become a trainee prosecutor.
Before law school, Hutapea had dreamed of joining the army, but he could not meet the height requirement.
Eventually, with his money running out, Hutapea left the student accommodation he was renting to move back in with his parents, who run a simple shop selling oil, eggs, rice and other groceries.
Hutapea has been working at his parents' shop, in a town on the outskirts of Medan, the capital of North Sumatra, ever since.
'I open the shop for them in the morning, sit there throughout the day serving customers and then help close at night,' Hutapea, who graduated from high school in 2020, told Al Jazeera.
'My parents don't pay me a wage for my work, but I can't blame them for that. They are giving me free food and lodging.'
Hutapea is far from alone in his struggles to find stable, well-paying work.
Indonesia has one of the highest rates of youth unemployment in Asia.
About 16 percent of the more than 44 million Indonesians aged 15-24 are out of work, according to government statistics – more than double the youth unemployment rate of neighbouring Thailand and Vietnam.
In a survey published by the ISEAS-Yusof Ishak Institute in Singapore in January, young Indonesians expressed far more pessimistic attitudes about the economy and the government than their peers in Thailand, Malaysia, Singapore, the Philippines, and Vietnam.
Only about 58 percent of Indonesian youth said they were optimistic about the government's economic plans, according to the survey, compared with an average of 75 percent across the six countries.
In February, some of this angst spilled onto the streets when university students formed the Indonesia Gelap, or Dark Indonesia, movement to protest government plans to trim spending on public services.
Economists point to a range of factors for the high rate of jobless youth in Southeast Asia's largest economy, from rigid labour laws that make hiring difficult to poor wages that fail to attract capable workers.
'Many people choose to be outside the labour market rather than having to work for a salary below expectations,' Adinova Fauri, an economist at the Centre for Strategic and International Studies (CSIS), Indonesia, in Jakarta, told Al Jazeera.
'Good jobs are also not widely available, so people turn to the informal sector, which has lower productivity and protection.'
Indonesia, which is home to more than 280 million people, has long struggled with chronic youth unemployment.
While still high compared with the rest of the region, governments have, through the years, made some progress in getting more young people into work – as recently as a decade ago, one-quarter of young Indonesians were estimated to be without a job.
Indonesian President Prabowo Subianto, a retired army general who oversaw crackdowns on the 1998 student protests that precipitated the fall of former President Soeharto, has acknowledged the need to create more jobs, establishing task forces to tackle unemployment and negotiate on trade with United States President Donald Trump.
On Wednesday, Prabowo hailed the beginning of 'a new era of mutual benefit' for Indonesia and the US, after Trump announced a deal to lower tariffs on Indonesian goods from 32 to 19 percent.
Though older adults are less at risk of being unemployed – Indonesia's overall jobless rate is about 5 percent – much of the work that is available is unstable and poorly compensated.
About 56 percent of the Indonesian workforce is employed in the informal sector, according to 2024 figures from the Bureau of Statistics, leaving millions in vulnerable conditions and without social security protections.
'The decline in the open unemployment rate does not necessarily reflect good performance in the labour market,' Deniey Adi Purwanto, a lecturer at the Department of Economics at IPB University in Bogor, told Al Jazeera.
'The quality of jobs and informal employment are still major problems.'
But for young people, the mismatch between the number of job seekers and jobs is particularly severe.
'Firstly, graduates of secondary and tertiary education do not always match the needs of the labour market, and there is also a high proportion of informality,' Purwanto said.
'Indonesia has a very large number of young people, so the pressure on the labour market is much higher.
'We also have rapidly increasing levels of secondary and higher education,' he added.
'Many young college graduates avoid informal or low-paid jobs, so they choose to wait for suitable jobs, which leads to unemployment.'
Purwanto said there was also a lack of effective vocational training and apprenticeship programmes in Indonesia, compared with neighbours such as Vietnam or Malaysia.
'In Malaysia, for example, there are more industry-university linkage schemes and graduate employability programmes,' he said.
Stark regional disparities in Indonesia, which is made up of some 17,000 islands, compound the problem, with young people in remote and rural areas finding it especially difficult to access good jobs.
This is particularly true in areas outside the island of Java, which is home to the capital Jakarta and more than half of Indonesia's population.
Hutapea experienced this firsthand when he moved back with his parents, who live about two hours out of Medan.
Despite having a law degree, Hutapea, who is desperate to no longer work in his parents' shop, has found job opportunities thin on the ground.
Hutapea, who also has a side gig setting up sound systems for weddings and parties, recently attended an interview for a job replenishing banknotes in ATMs.
But even though he thought the interview went well, he never heard back from the recruiter.
For Hutapea, who completed some of his law school modules during the summer holidays so he could graduate a year early, it is hard not to feel like his efforts have not been in vain.
'I didn't want to be a burden to my parents, who were paying all my university fees,' Hutapea said.
'But look at me now.'