Reporter: Caecilia Mediana
Kompas.id, April 9, 2026
JAKARTA, KOMPAS — The World Bank assesses that prolonged geopolitical uncertainty could depress investment and impact job quality. Temporary contract employment is also expected to increase in several countries.
World Bank Group Research Director Aaditya Mattoo said on Wednesday (April 8, 2026) that the escalation of conflict in the Middle East and the trade tariff war are driving economic policy uncertainty and depressing trade performance.
"We estimate this situation will harm investment, employment, and, interestingly, change the quality of jobs," he said at an online press conference to review the World Bank's latest report, "East Asia & Pacific Economic Update: Industrial Policy in the Digital Age April 2026," in Jakarta.
Aaditya said global uncertainty would drive more companies to use contract workers. This trend is part of a new informality trend in the workplace.
Previously, the trend of informality was already evident in the rise of gig workers, such as delivery couriers, which grew alongside the e-commerce industry. The employment relationships typically formed were partnerships or contracts.
In China, Aaditya mentioned, there is an autobiographical book entitled I Deliver Parcels in Beijing. This book tells the story of a courier worker who feels that his job delivering goods is quite hard, tiring, and has minimal career prospects.
Some economists now believe the service sector could be a new path for economic development. However, the big question is: are wages in this sector actually increasing over time? And how extensive is the skills training process?
According to Aaditya, the main challenge the government must address is creating meaningful social security protection for informal workers. In the Indonesian context, an adaptive digital data collection and social security system is needed to address the trend of worker informality.
After the pandemic
When contacted separately, Victoria Fanggidae, Executive Director of The Prakarsa, stated that the trend of worker informality in Indonesia has increased following the COVID-19 pandemic. Similar trends are common in other middle-income countries.
This situation adds to the burden on workers' welfare, given that informal jobs tend to have lower income quality and minimal access to social security.
From The Prakarsa's perspective, he suggested that the pension insurance program under BPJS Ketenagakerjaan be opened to informal workers. The National Social Security System Law already mandates universal coverage, but implementing technical regulations are lacking.
"By opening access to pension insurance programs for informal workers, we hope to reduce the risk of poverty in old age," said Victoria.
Contract employees are most vulnerable
Ippei Tsuruga, Social Security Program Manager for Indonesia at the International Labour Organization (ILO), stated that when an economic shock occurs, companies are expected to reduce their workforce. Contract employees are typically the first to be affected.
Indonesia already has Job Loss Insurance (JKP) under the BPJS Ketenagakerjaan program. However, this policy does not allow JKP payments to contract workers whose contracts have expired.
Contract workers eligible for JKP must have been laid off before the end of their contract, provided they have contributed for at least 12 months in the last 24 months and participated in four social security programs.
If a contract worker is frequently laid off before the contract expires, their right to receive JKP is limited. "We recommend reforming the JKP program in response to the projected rise in contractual/informal employment relationships," he said.
Meanwhile, Mirah Sumirat, President of the All-Indonesian Trade Union Association (Aspirasi), observed that the trend of contract worker recruitment has become increasingly prevalent since the COVID-19 pandemic. This is especially true since Indonesia had already begun implementing the Job Creation Law at that time.
In fact, the survey report "2022-2023 Outlook: Recruitment, Compensation, and Benefits" released by Jobstreet Indonesia (a job provider website) also mentioned the increasing trend of temporary/contract worker vacancies.
Around 70 percent of the 1.162 companies surveyed stated they wanted to increase or maintain the number of contract workers. Only 5 percent planned to reduce their reliance on contract workers, while the remainder had no plans.
The same report states that there are 10 most popular job functions for part-time/contract staff. The top most popular job function is administration and human resources, followed by marketing/business branding, sales/business development, accounting, and engineering. Next, job functions include information technology, manufacturing, transportation and logistics, digital marketing, and design.
In addition to contract employment, the practice of outsourcing workers will also become widespread, citing cost efficiency. Even more alarming, Mirah said, is that a number of companies hiring outsourced workers are reluctant to enroll their workers in social security programs, including health and employment.
"So, in Indonesia, there is an issue of monitoring compliance with social security participation. More accommodating program reforms are needed to address the trend of contract work and widespread outsourcing practices," he said.
According to data from the Central Statistics Agency (BPS), as of February 2019, there were 74,08 million informal workers in Indonesia, or 57,27 percent of the total workforce. In February 2020, the number stagnated at 74,04 million (56,50 percent).
In subsequent years, the number of informal sector workers consistently rose sharply, reaching 78,14 million people (59,62 percent) in February 2021 and rising to 81,33 million people (59,97 percent) in February 2022.
Although the economic recovery phase from the impact of the pandemic began in 2023, the number of workers in the informal sector has not decreased. In fact, it has increased.
Post-pandemic, the number of informal workers was 83,34 million people (60,12 percent) as of February 2023 and 84,13 million people (59,17 percent) as of February 2024. This trend continued in 2025. As of February, the number had swelled to 86,58 million people (59,40 percent).
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