It is time to immediately activate anticipatory or mitigation measures to respond to the wave of mass layoffs, the closure of large factories, and the declining competitiveness of the country's labor-intensive industries.
If the trend is not responded to with serious intervention, Indonesia will not only lose its strategic industrial sectors but also experience a detrimental social impact.
Recently, textile giant PT Sri Rejeki Isman (Sritex) ceased its operations, causing mass layoffs among its employees. Dozens of other textile factories also experienced the same problem.
The Indonesian Filament Yarn and Fiber Producers Association (APSYFI) has confirmed the truth of circulating data that at least 61 textile factories had closed, stopped operating, and laid off thousands of employees.
APSYFI General Chairperson Redma Gita Wirawasta stated that data on textile factories that closed and laid off workers was recorded from January 2023 to December 2024, and the factories were located in Banten, West Java, and Central Java.
The association also received a recent report on a new factory, PT Mbangun Praja Industri, that had closed in January 2025.
He hoped the government would promptly take control measures for imports and eliminate import practices that disadvantaged the domestic industry.
Thousands of workers have lost their jobs, and thousands more are facing uncertainties. Several large factories that served as the backbone of textile exports have ceased operations, displaced by the influx of cheap imported products flooding the domestic market.
This must be seen as a sign of the need for improvements in Indonesia's economic policies, especially those related to labor-intensive industries.
Significant contribution
Many still consider the textile industry as a sector that is no longer relevant amid the rise of automation and the development of technology-based industries.
In fact, the textile industry has long been one of Indonesia's largest absorbers of labor and has made a significant contribution to the national economy.
In various countries, the industry is still maintained as a strategic sector, supported by protective regulations and incentives that encourage competitiveness.
Deputy Chair of Commission VII of the House of Representatives (DPR) Chusnunia Chalim noted that the government needs to immediately take concrete measures to save labor-intensive industries currently experiencing huge pressure.
Indonesia does need policies that support the domestic textile industry ecosystem to ensure its continued growth and survival. For instance, opening the import tap must be carefully considered, as it can potentially accelerate the destruction of this sector if not accompanied by a mitigation strategy.
Imported textile products at cheaper prices, legally or illegally, will also make it hard for local products to compete.
Meanwhile, the domestic industry is still dealing with various limitations, from high production costs to regulations that are not yet supportive.
Furthermore, the community's declining purchasing power has also worsened the situation. Consumers tend to choose cheaper products without considering the impact on the continuity of the domestic industry.
In this condition, without sufficient protection, the national textile industry will be at risk of collapse.
Indonesia must be more assertive in protecting its textile sector than other countries. China, for instance, provides large subsidies to its textile industry, ensuring its products remain competitive in the global market.
Vietnam and Bangladesh have also adopted strategic policies to keep their textile industries alive by providing tax incentives and building a more efficient ecosystem.
In Indonesia, such measures need to be continuously encouraged. Instead of providing subsidies or protection, the industry should not be burdened with ever-increasing production costs, including electricity rates and wages that increase yearly without being balanced by improvements in productivity.
One of the aspects that need to be significantly improved is the law enforcement against illegally imported products. Illegal imports have placed growing pressure on the domestic industry.
Surviving textile companies are now faced with a tough decision: to survive with all the limitations or close their businesses and relocate production to other countries that are more competitive.
If this trend persists, Indonesia may rely entirely on imports for its textile needs in the next few years. This situation certainly poses significant risks, not only from an economic standpoint but also in terms of the national industry's resilience.
Quick intervention
Labor observer and Secretary General of the All Indonesian Workers Organization (OPSI) Timboel Siregar underscored that the government needs to implement strategic measures to prevent significant layoffs in the labor-intensive industrial sectors.
Quick and precise intervention is necessary to prevent the collapse of the national textile industry.
Several concrete steps can be taken immediately to address this problem. The main priority is to reimplement safeguards to limit uncontrolled textile imports.
Without this protection, domestic textile products will continue to be undermined, and more factories will go out of business.
The government must provide incentives to the local textile industry, both in the form of energy subsidies and more affordable financing access. These will help the industry remain competitive and survive during difficult periods.
Furthermore, policies should be put in place that encourage the textile industry to innovate and increase production efficiency, such as by adopting more modern technology and developing products with more added value.
In addition, a nationwide campaign to encourage people to buy domestic products must be intensified.
Consumer awareness of the importance of buying local products must be raised, not only from an economic perspective but also as part of the efforts to maintain the resilience of the national industry.
This is not just a matter of market preference but concerns the future of millions of workers who rely on this sector for their livelihoods.
Meanwhile, law enforcement needs to be strengthened to combat illegal imports. Unless monitoring becomes stricter, illegal goods will continue to enter and harm the domestic textile market.
Law enforcement officers and related agencies must intensify their efforts to stem trade practices detrimental to local industries.
The paralysis of the textile industry is not merely a statistical figure or a sectoral issue. It is a strong warning to all parties about an imbalance in the economic system that requires immediate resolution.
If the textile industry continues to operate in an unfavorable environment, the looming threat of waves of layoffs will have a broad impact on the country's social and economic stability, elevating it to a national issue rather than merely an industry concern.
While time is ticking, Indonesia still has the opportunity to save its textile sector.
The choice is in the hands of all elements of the nation: letting the industry collapse or taking a bold step to save it.
It will determine whether to still have a competitive national textile industry or to only be a market for imported products.
It is time to respond to the red sign warning from the national textile industry.
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Editor: Rahmad Nasution
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