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Supporting the Job Creation Perppu to Face the Economic Crisis

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Jakarta – An economic crisis could occur in 2023, this has become the basis for the government to act quickly by issuing a Government Regulation in Lieu of Law (Perppu) on Job Creation.

The existence of the Perppu Ciptaker to anticipate global economic turmoil has received wide public support. Iwan Sumule as Chairman of the Pro-Democracy Activist Network Assembly (ProDEM) said that the Job Creation Perppu is seen as very necessary to deal with the 2023 economic crisis, so that the negative impact on the Indonesian people can be minimized.

Iwan said that the Job Creation Perppu had adjusted to the rules for forming new laws and regulations. The procedure does not need to be argued anymore because the omnibuslaw method has been accommodated in it.

According to Iwan, regarding the urgency of a very fast world change, it is appropriate to implement it because of the threatening economic danger. Moreover, in 2023 the economic calculation, the whole world will experience a crisis and the IMF predicts that the global economy will only grow 2.7% in 2023 and even Indonesia will be affected.

He said the government must be anticipatory and cannot do business as usual, including in the formation of laws related to economic activity and investment. Investment law in Indonesia is still less agile even when compared to neighboring countries such as Vietnam and the Philippines.

Iwan said, according to the Constitutional Court’s decision, the Job Creation Law is still valid even though the government is prohibited from making strategic policy turn regulations because it has to wait for revisions to be made by the DPR. This of course will cause anxiety and problems for both workers and employers.

Meanwhile, the Ministry of Law and Human Rights (KEMENKUMHAM) denied that the Job Creation Perppu was issued suddenly. The Job Creation Perppu is needed in dealing with global economic conditions that will be difficult this year.

Acting Director General of Legislation KEMENKUMHAM Dhahana Putra said, at this time Indonesia is faced with global economic conditions where there is a weakening of economic growth along with rising prices, supply chain problems which have an impact on limited supply, especially in goods. -Basic goods, such as food and energy.

The term stagflation itself is a combined terminology from the words stagnation and inflation. Stagflation is a period of inflation followed by a decline in the Gross Domestic Product (GDP). Stagflation is also defined as a condition when the level of the economy does not develop at the same time as there is a continuous increase in prices.

The Perppu on Job Creation should indeed have been issued, this is due to a legal vacuum where it takes a long time to make laws procedurally, while these urgent conditions/needs need certainty to be resolved.

Based on this compelling urgency parameter, the President has the authority to issue a Perppu in accordance with the provisions of Article 22 paragraph (1) of the 1945 Constitution of the Republic of Indonesia which attributively gives the President special rights to issue a Perppu in the event of a compelling urgency.

Meanwhile, nine factions in the DPR RI have expressed their views regarding the Job Creation Perppu. 7 factions have stated that they agree if the Job Creation Perppu is discussed further according to the stages of making legislation, while two factions have refused.

Airlangga Hartarto as the Coordinating Minister for the Economy expressed his appreciation for the views of all factions on the Job Creation Perppu, both those who support it and those who oppose it. All of these notes will of course be input for the government, because after this there will be derivative regulations from the Job Creation Perppu.

He also said that the issuance of the Job Creation Perppu was urgent, because the government needed to anticipate various risks of global uncertainty including those related to the potential for a global recession, rising inflation to the threat of stagflation.

On a different occasion, Economist from Mercu Buana University, Sugiyono Madelan Ibrahim, assessed that the issuance of the Perppu was indeed based on a compelling urgency and as a follow-up to the decision of the constitutional court (MK) as written in the Perppu. He admitted that he took part in the process of demarcating the Job Creation Law. The regulation is indeed designed to encourage the government to improve performance in the economic sector.

In Sugiyono’s opinion, the government really needs the Perppu to move the wheels of the economy in the midst of many unfavorable economic conditions for national development.

The Director General for the Development of Industrial Relations and Social Security (PHI and Social Security) of the Ministry of Manpower, Indah Anggori Putri explained that there had been a change in substance in the Job Creation Perppu when compared to the regulations derived from the copyright law.

In the Job Creation Perppu issued at the end of 2022, there has been a change in the calculation formula taking into account three variables, namely economic growth, inflation and certain indices. This change is intended to provide a more adaptive formula for calculating the minimum wage.

Changes also occurred with the affirmation of the conditions for setting the district/city minimum wage (UMK). The UMK can be determined if the calculation result is higher than the provincial minimum wage (UMP).

Of course, the economic crisis can have various impacts on the joints of social life, so regulations are needed to mitigate the economic crisis.

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