The Minister of Labor issued circular B-M 308, 2019, which mandates provincial governors throughout Indonesia to increase their provinces’ minimum wage by 8.51 percent, starting from January 1, 2020.
For 2020, the government calculated the minimum wage rate by using data from October 2019, which is as follows: National Inflation (3.39 percent) + National Economic Growth (5.12 percent) = 8.51 percent in minimum wage increase.
With this data, the governor of every province, in cooperation with the provincial Wage Councils, calculates the minimum wage rate (taking into account the living wage) through the following formula: New minimum wage = current minimum wage + (current minimum wage x percentage of minimum wage increase (8.51%)).