The Job Creation Law (UU) is currently considered to have had a significant positive impact on improving the economy in Indonesia. The Job Creation Law is also considered an important step in avoiding the middle income trap which can hamper the development of developing countries. So the implementation of the Job Creation Law is very important because it has an impact on improving the economy and encouraging investment in Indonesia.
Apart from that, there are many benefits that the Job Creation Law can provide. Not only for business actors, workers will also get better benefits and increased protection compared to the Employment Law. The Job Creation Law also guarantees the certainty of providing severance pay and protection to workers by implementing the Job Loss Guarantee Program (JKP).
JKP is a form of protection for workers affected by layoffs in the form of cash benefits, upskilling and upgrading, as well as access to the labor market. With this program, workers who are victims of layoffs are protected by the state for a certain period of time to find new jobs. Apart from that, with the opening of fixed-term work agreements (PKWT) for all types of work, job opportunities will become more widely open.
Then for Micro, Small and Medium Enterprises (MSMEs), the benefits obtained from the Job Creation Law are in the form of support in the form of convenience and certainty in the licensing process through OSS (Online Single Submission). MSME players are also given convenience in registering Intellectual Property Rights (IPR), establishing an individual Public Company (PT), as well as simplified requirements and low costs.
Professor of Business Law at Gadjah Mada University (UGM), Professor Nindyo Pramono, said that the Job Creation Law has had a positive impact on increasing investment, including foreign investment (PMA), in Indonesia. So that investors respond positively to the structural reform efforts realized through the Job Creation Law.
Apart from that, the positive impact of the Job Creation Law is also felt in the MSME sector, which is the foundation of the economy in Indonesia. The Job Creation Law has succeeded in reforming the licensing process and providing ease of doing business, thereby overcoming existing bureaucratic obstacles. Previously complicated licensing procedures can be overcome with the OSS System. This reform has helped increase economic growth and provided ease of business licensing for MSMEs.
Furthermore, the Job Creation Law has a positive impact on the investment climate which will ultimately support the creation of job opportunities. This can improve the community and national economy. The Job Creation Law also emphasizes the role and function of regional government as part of the government system, where existing authority is still implemented by the Regional Government, in accordance with the Norms, Standards, Procedures and Criteria (NSPK) set by the Central Government, so that it will creating a good standard of service for all regions.
Meanwhile, Economic Observer, Dendi Ramdani, said that one of the implementations of the Job Creation Law aims to increase competitiveness and national economic growth. This regulation is also to push Indonesia towards becoming a high income country. Apart from that, the structural transformation carried out through the Job Creation Law is a strategic step, considering that many countries fail or are late in carrying out structural transformation and end up being trapped in the middle income trap.
Experience from several countries around the world shows that if a country fails to implement structural transformation well, it will not achieve high-income status. On the other hand, the country will fall into the middle income trap, which means that economic growth will slow down, productivity will decrease, and per capita income will decrease. Several countries, such as Brazil and South Africa, are examples of countries that failed to carry out structural transformation and experienced a decline in per capita income after reaching a certain peak.
Then the Job Creation Law will be a Big Game Changer to encourage economic transformation, through regulatory reform and encouraging ease of doing business. The timing of the current Job Creation Law is very appropriate, because it creates jobs, which will help reduce the negative impact on those who have been laid off or laid off. And through the Job Creation Law, the government encourages job creation and also encourages people to become entrepreneurs.
The Job Creation Law is a form of win-win solution presented by the government for various problems that have occurred in the business sector and employment management. All parties will benefit, for example business actors can develop businesses without complicated and profitable regulations. Apart from that, workers’ rights can be better appreciated, and investors can gain certainty and ease in investing.
Legislative products should indeed be an important part of establishing equal justice for all parties. Therefore, the existence of the Job Creation Law can be the right solution in creating an expansion of employment opportunities and optimizing resources for the welfare of all Indonesian people.
