The Real Test of Indonesia’s Growth

Indonesia aims to create between 2.57 million and 3.49 million new jobs in 2027. At the same time, around 60 percent of the country’s workers remain in informal employment. This means Indonesia faces a dual challenge: creating new jobs and expanding access to formal employment.

Investment matters because it is one of the main drivers of new job creation. But the impact is not the same across sectors. Some investments create only a limited number of jobs, while others can support employment across a much wider chain of businesses, from suppliers and contractors to distributors and smaller enterprises.

For example, Indonesia plans to develop 100 GW of solar power, a program the government estimates could generate 5.52 million cumulative jobs. Around 3.5 million of those jobs could come from the solar panel and battery energy storage industries, with another 2 million in construction. But turning that potential into actual employment will depend on whether projects can secure investment and whether workers are ready to fill the jobs they create. Delivering those jobs will require a predictable business environment, sufficient financing, and workers with the right skills. These needs closely reflect the three foundations identified in the IBC Business Outlook 2026: Certainty, Capability, and Capital.

Certainty matters because investors need clear regulations, legal certainty, consistent incentives, and efficient licensing before committing to long-term projects. Capability determines whether Indonesian workers are ready to fill the jobs created, which means education and vocational training need to keep pace with demand for engineers, technicians, construction workers, and other skills required by growing industries. Capital is then needed to move projects from planning to implementation and to help businesses across the supply chain expand and create more jobs.

“Creating millions of jobs will depend on our ability to connect investment with the sectors that can generate broad employment opportunities, while preparing workers to participate in that growth. Certainty, capability, and capital need to move together,” said Fazlur Rahman Hassan Principal Policy and Program IBC.

In the end, the success of Indonesia’s employment agenda should therefore be measured by the quality of jobs created and their ability to deliver stronger and more sustainable household incomes.