Employment and Skills Strategies in Indonesia
This report comes at a time when policy makers are challenged by the COVID-19 crisis that is generating a profound reflection on economic and social well-being. Before COVID-19 hit, Indonesia had experienced remarkable economic growth, making substantial progress in poverty reduction and gains in employment. However, there are large differences in outcomes across Indonesian provinces, which often reflect the quality of local infrastructure, services, education, and jobs. This joint Asian Development Bank (ADB) and Organisation for Economic Co-operation and Development (OECD) study sheds light on challenges and opportunities to promote employment and skills outcomes at the local level in Indonesia. The analysis presented in this OECD/ADB report shows the importance of strengthening local institutions managing and delivering employment and skills policies.
Setting the stage for good local employment and skills policies in Indonesia
To understand employment and skills outcomes at the local level in Indonesia, it is important to delve into the country’s economic development context. While the ongoing COVID-19 pandemic poses unexpected challenges to local development, Indonesia has experienced strong economic growth over the last decades. However, there are large provincial disparities with western provinces characterised by better economic performance as compared to rural and remote provinces, especially in the east of the country. In the late 1990s, Indonesia embarked on an ambitious reform programme, by transferring responsibilities to local governments. This chapter outlines recent socio-economic trends across Indonesian provinces.
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