ILO’s High-Level Forum examines implications of artificial intelligence for the Indonesian labour market

JAKARTA, Indonesia (ILO News) – The rise of artificial intelligence (AI) represents a transformative force, simultaneously offering exciting opportunities and posing significant challenges in the labour market. While AI has the potential to enhance worker productivity and drive economic growth, it also raises concerns about job displacement and exacerbating existing inequalities.

We have launched the National Strategy for Development of Indonesia’s Digital Economy 2030 as part of the country's effort to execute digital transformation. 

Airlangga Hartarto, Coordinating Minister for Economic Affairs 

To further discuss the impact of AI on the world of work, the International Labour Organization (ILO) organized a High-Level Forum, “Artificial Intelligence (AI) and Implications on the Indonesian Labour Market”, on 20 June in Jakarta. The AI Forum was kickstarted with a keynote address by Airlangga Hartarto, Coordinating Minister for Economic Affairs on the opportunities for jobs in the Indonesian labour market and an opening address by Celeste Drake, ILO Deputy Director-General, which highlighted some of the key global issues and challenges.

Bringing together a strategically diverse set of experts for this first dialogue on AI in the context of the labour market needs, preparedness and governance in Indonesia, the ILO AI Forum served to stimulate a very timely reflection on Indonesia’s current situation and the way forward on workforce planning and investment. The Forum provided initial direction on where to head, and how best to get there in terms of harnessing the labour market dividends, leaving no one behind. Indonesia is the region’s largest potential market for investment in AI development, with significant potential for spurring and showcasing an even more equitable labour market that could reap the benefits of AI, while mitigating any risks.  

Airlangga Hartarto, Coordinating Minister for Economic Affairs, underscored the commitment of Government of Indonesia to prepare for the AI future in Indonesian economy. “We have launched the National Strategy for Development of Indonesia’s Digital Economy 2030 as part of the country's effort to execute digital transformation that helps to enhance the economic landscape, protect digital talents, create jobs and ensure our march achieve the Sustainable Development Goals (SDGs),” he stated.

The ILO is making a significant investment in expanding our frontier research on AI. We will launch a new Observatory on AI and Work in the Digital Economy by early September.

Celeste Drake, ILO Deputy Director-General

The ILO global study, Generative AI and Jobs: A global analysis of potential effects on job quantity and quality, reveals that AI is more likely to augment than destroy jobs by automating some tasks rather than taking over a role entirely. Therefore, the greatest impact of this technology is likely to not be job destruction but rather the potential changes to the quality of jobs, including work intensity and autonomy.

The potential effects of generative AI are likely to differ significantly for men and women, the study finds, with more than twice the share of female employment potentially affected by automation. This is due to women’s over-representation in clerical work, especially in high and middle-income countries.

“The ILO is making a significant investment in expanding our frontier research on AI. To improve the visibility of our work and engage with constituents and others, we will launch a new Observatory on AI and Work in the Digital Economy by early September,” stated Celeste Drake, ILO Deputy Director-General. “The ILO 2025-2026 standard-setting discussion on decent work in the platform economy is also an opportunity to discuss the potential role of international labour standards in addressing the challenges and opportunities posed by technological advancement.”

Shinta Widjaja Kamdani, Chair of the Indonesian Employers’ Association (Apindo) and Rekso Silaban, Head of International Adviser of the Confederation of All Indonesia Labour Union (KSBSI), provided their insights on how employers and workers can make the best use of technology change, such as AI, to overcome labour market challenges and harness opportunities to be more productive.

“Social dialogue is key for the adoption of the national strategy on AI and to ensure the well-involvement of workers,” concluded Rekson; while Shinta emphasized the importance equality and inclusivity. “The AI infrastructure plays a big role as AI should be accessible to everybody, including women and marginalized groups. Promoting inclusivity and equality can be one of the efforts to narrow the gap.”

© ILO/Feri Latief

The AI Forum also heard the views of key resource persons representing the government and the private sector. Prof. Warsito, Deputy for Coordination of Education Quality Improvement and Religious Moderation of the Coordinating Ministry on Human Development and Culture, highlighted the urgency of improving Indonesian human capital with relevant skills that are compatible with the fast-changing world of work with technology advancements that are here to stay, such as AI.

Prof. Anwar Sanusi, Secretary General of the Ministry of Manpower, emphasized the importance of labour market governance hand in hand with employment policy development that are an essential formula for ensuring both the sustainability of businesses and labour force participation in decent work.

From a business perspective, Ajar Edi, Director of Government Affairs of Microsoft Indonesia and Brunei, shed light on the priorities of Microsoft I as an investor and development partners in Indonesia, and its contribution to Indonesia’s national development. Agus Dwi Handaya, Director of Compliance and Human Resources of Bank Mandiri, underscored the need to use digitalization to strengthen the competitiveness of small- and medium-sized enterprises who form the backbone of the Indonesian economy. 

For more information, please contact:
Diego Rei   
ILO’s Labour Market and Employment Specialist
rei@ilo.org 

Lusiani Julia  
ILO’s Programme Officer
lusiani@ilo.org 

Gita F. Lingga  
Senior Communications and Information Management Assistant
gita@ilo.org