Indonesia warns unemployment to spike due to COVID-19 pandemic

Women are pictured wearing a protective face mask and face shield as the Indonesian government eases restrictions to prevent the spread of COVID-19 in Jakarta, Indonesia, Jun 8, 2020.

JAKARTA: Indonesia expects its unemployment rate to spike to 8.1 per cent to 9.2 per cent this year due to the economic impact of the coronavirus pandemic, from 5.28 per cent in 2019, according to presentations by Cabinet ministers in a parliamentary hearing on Monday (Jun 22).

Planning Minister Suharso Monoarfa told members of parliament’s finance commission the government predicted 4 million to 5.5 million people will lose their jobs this year. The unemployment rate may stay elevated in 2021 at 7.7 per cent to 9.1 per cent, he said.

Indonesia’s gross domestic product in the second quarter was seen contracting by 3.8 per cent, Finance Minister Sri Mulyani Indrawati said in the same hearing, slightly more than her previous estimate of a 3.1 per cent shrinkage.

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