“Wage disparity is one of our challenges, and it cannot be resolved within a single year,” Yassierli said when met at the Parliamentary Complex here on Wednesday.
He noted that wage disparity remains a main concern for the government. Therefore, his ministry has set an index or alpha range in the provincial minimum wage (UMP) regulation at between 0.5 and 0.9 as one of the instruments to narrow wage gaps in each province.
The alpha index is stipulated in Government Regulation (PP) No. 49 of 2025, under which the UMP calculation formula consists of inflation plus economic growth multiplied by a coefficient (alpha of 0.5–0.9). With this formula, the increase in the 2026 UMP is in the range of 5-7 percent.
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Furthermore, Yassierli said his ministry would consider input from the House of Representatives’ Commission IX to formulate a roadmap to address the issue.
“We received input from the House, and accept that there must be a roadmap on how disparity in the minimum wage, such as the decent living needs (KHL) index, will be addressed,” he explained.
Another topic related to wage disparity during the meeting was the implementation of PP No. 49 of 2025. The regulation responds to Constitutional Court Decision No. 168/PUU-XXI/2023 and is expected to be the reference for the annual UMP determination.
Yassierli also stressed the need to strengthen the capacity of Regional Wage Councils and Regional Tripartite Cooperation Institutions so they can recommend comprehensive wage policies.
“KHL data are important to reduce disparities or gaps in minimum wages between regions, in order to mitigate negative impacts that could disrupt regional stability and conditions,” he said.
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Translator: Arnidhya, Kenzu
Editor: Rahmad Nasution
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