Jakarta, The PRAKARSA – On Friday (24/10/2025), The PRAKARSA release Working paper by title "It's Time for Indonesia to Accelerate Active Labor Market Policies (ALMP)"The results of this study highlight that although Indonesia's Open Unemployment Rate (TPT) has declined, structural challenges remain in the structure of the Indonesian labor market, including the dominance of informal workers, low productivity, and massive unemployment. skill mismatch between graduates of educational and training institutions and industry needs.
The author and researcher PRAKARSA, Ari Wibowo, said that paper This paper was written to provide an analysis of the importance of ALMP in encouraging labor absorption in Indonesia. "ALMP aims to intervene in the labor market by providing programs that bridge the gap between the two sectors," he said. demand and supply workforce, for example through training, reskillingand upskilling”.
According to Pierre Ballo, researcher at The PRAKARSA, ALMP should be positioned on a par with the program Passive Labor Market Policies (PLMP) such as Social Assistance/Bansos. "Currently, the government's priority seems to be allocating Social Assistance, judging by various indicators, especially government funding." However, various studies have shown that ALMP has been proven to encourage employment. "It just remains to be seen how it's designed. It would be better if the industry directly designed the curriculum and training structure."
Executive Director of The PRAKARSAVictoria Fanggidae also commented on the funding dimension of the ALMP. "In the 2020-2024 RPJMN, the government has actually integrated the Skills Development Fund/DPK mechanism to fund vocational programs, but its implementation has been largely unsuccessful." paper Here, the author provides examples of several DPK mechanism options, taking case examples from countries that have already implemented them.
Working paper This study concludes that Indonesia has a sound policy foundation across the three pillars of the Active Labor Market Policy (ALMP): skills development (Pre-Employment Card & BLK), Labor Market Services (Karirhub), and Social Protection (JKP & BSU). However, its implementation remains fragmented, creating fundamental weaknesses that lie in the weak linkages between the supply (training) and demand (industry) sides.
Good practice review (best practice) to global, such as in Denmark, Singapore, and South Korea implies that effective ALMP must be integrated and supported by industry with strong tripartite governance support, and have a sustainable financing mechanism. Indonesia is at risk of being caught in skill trap if there is no comprehensive design strengthening and integration. Therefore, The PRAKARSA encourage the government to implement the ALMP program by building a synergistic ALMP ecosystem.