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The Real Score on the Number of Foreigners Working in Indonesia

As a country who has suffered from colonization for many centuries, it’s no surprise that Indonesia holds a climate of distrust with foreigners who wish to stay and work in the archipelago. Recently, the country was upset by rumours that ten million Chinese are illegally working in Indonesia, as locals fear that these immigrants are ‘stealing their jobs.’

But exactly how many foreign workers are currently in Indonesia?

The Indonesian government agency Investment Coordinating Board (BKPM) reported  that there are 74,183 foreign workers currently in Indonesia. Compared to the country’s total workforce of 120 million individuals, the figure is actually very low, as it accounts for only a minimal 0.062 percent.

BKPM Chairman Thomas Lembong says the ratio is extremely low. To illustrate his point, Lembong pointed out how the foreign workforce in Singapore makes up 36 percent of its total workforce, while Malaysia’s and Thailand’s foreign workforce accounts for 15.3 percent and 4.5 percent respectively. In Arab countries like Qatar, however, foreign workers account for a staggering 96 percent of the nation’s entire workforce.

While the Qatar figure is a weak point of reference for being an extreme case, the other numbers from the Asian countries should be enough to eliminate the paranoia of those who have been worried about the fake news claiming there are more than 10 million Chinese workers in Indonesia.

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Investment Coordinating Board Chairman Thomas Lembong

See: Jokowi: I Want Foreigners to Run Some of Indonesia’s State-Owned Enterprises

In fact, there is more reason to be happy, as the number of expats actually working in Indonesia have dropped over the past five years together with the commodity downturn. Assumptions put the declining number as a result of the setback in the country’s oil and gas industries and with several major foreign oil companies cutting their Indonesian assets down.

The number of foreign workers in Indonesia is in fact too low. To be recognized as an upper middle-income country, a high ratio of foreign workers to the country’s total workforce should be considered a positive contribution for Indonesia. Foreign workers, especially those who are highly skilled and knowledgeable, will be able to teach their skills and share their knowledge to Indonesian workers.  

In the same manner that a small number of foreign workers in the archipelago will be tantamount to saying that foreign direct investment (FDI) is minimal, when FDI is a critical factor that will boost the Indonesian economy to higher levels.

As to the number of Chinese workers in Indonesia, the BKPM head reported that there are about 21,270 Chinese workers currently employed in Indonesia. While that figure can be considered large for the total number of foreigners working in the country, it is also worth noting that FDI from China to Indonesia was at US$1.6 billion in the period of January to September of 2016.

There is no doubt that as the third-biggest foreign investor in Indonesia for the above period, China and its billions of investment have indeed created a significant number of employment opportunities for the local Indonesian workforce. Of the 975,898 new employment opportunities created by the total FDI into Indonesia in the January-September 2016 period, 957,932 were given to local Indonesians.

To close, fewer expats in the archipelago affect the country’s economy as they form part of the ‘big spender’ group, who, more often than not, provide employment for the low-class locals. Expat families living in Indonesia will normally hire nannies, drivers, housemaids, gardeners and many more. When these expats move back to their home countries, the Indonesian local workers will unfortunately have to find new employment elsewhere.

Image credits: NotJustaLabel, Twitter

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Nadya Joy Ador is a Philippines-based journalist and editor for Content Collision. She routinely covers business, news, and human interest topics. See her portfolio at nadyajoyador.c2live.com and build your own for free!