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Indonesia

Impacts of COVID-19 on Indonesia's garment sector

Background information on garment sector

Indonesia’s textile industry is one of the largest in the world, employing over 2.5 million people and generating over $13 billion in exports annually. Of its total garment production, 30% is to meet domestic demand with the remainder for exports mainly to the United States (36%), the Middle East (23%) the European Union (13%), and China (5%). Brands sourcing from Indonesia on our tracker can be viewed below.

The minimum wage increased in January 2020 by 8.51 percent and varies regionally between IDR 2,704,000 (US$120) per month to IDR 4,200,000 (US$298) per month, however this still falls short of the estimated living wage of IDR 7,249,086 (US$503) per month.

The 2020 ITUC Global Rights Index – which rates countries on a scale from 1 (best) to 5+ (worst) on the degree of respect for workers' rights – rates Indonesia as 5, indicating workers have no guarantee of internationally recognised labour rights.

Impacts of pandemic

Job losses

The Indonesian Textile Association reports that 2.1 million workers in the garment and footwear sectors have lost their jobs as a result of the COVID-19 pandemic. It is estimated that 70% of garment factories in the country will be forced to permanently close as cash-flow difficulties arise as a result of the crisis.

Wages & social protections

According to a survey conducted by Decent Work Check, only 25% of garment factories report paying full wages to their workers dismissed or sent home during the pandemic. Clean Clothes campaign estimates that in the months of March, April and May garment workers in Indonesia lost a total of approximately 40% of their normal wages, equivalent to US$406 million (despite government initiatives detailed below).

The Government of Indonesia has pledged to provide training and cash assistance for laid off workers through the “pre-employment card” programme, where each recipient is entitled to a benefit package of IDR 3,550,000 (US$246) on the condition they complete certain online training programmes. However, garment workers are not among the priority beneficiaries and trade unions say the programme is hard to access for workers without smartphones and internet access, and have criticised the conditionalities given that workers are struggling for food and other basic necessities. By June 2020, although 434,000 people had already completed the training, only 361,000 had received IDR 600,000 each; or just 7% of the median minimum wage of a garment worker up to that time, according to Clean Clothes Campaign.

Some families have received cash transfers of IDR 600,000 (US$42) per household per month for three months between April and June. They will receive IDR 300,000 (US$21) for the next three months until September. Asia Floor Wage Alliance deems the amount to be insufficient to meet the basic needs of a family.

The Indonesian Textile Association has requested permission to legally cut or postpone festive bonuses and other bonus payments to garment workers.

Labour and human rights violations

In Indonesia, we have tracked reports of the following rights violations of garment workers during the COVID-19 pandemic:

This is not a comprehensive list of violations and cases, full coverage of the impacts of COVID-19 on Indonesia’s garment sector and related industrial disputes can be viewed here. Actions taken by fashion brands sourcing from Indonesia in response to the pandemic can be viewed below.

Demands from local unions & civil society groups

Asia Floor Wage Alliance, WIEGO, HomeNet South Asia and HomeNet South East Asia are calling on brands to make a one-time Supply Chain Relief Contribution equal to 60 days of wages lost for all garment workers in their supply chains – including time-rated, piece-rated, subcontracted and home workers – during the COVID-19 crisis, as a requirement of responsible business practice.

Click below to find out more information directly from local unions and labour groups:

Federasi Serikat Buruh Garmen, Kerajinan, Tekstil, Kulit dan Sentra Industri (FSB Garteks)

Federasi Serikat Buruh Indonesia (FSBI)

Gabungan Serikat Buruh Indonesia (GSBI)

Lembaga Informasi Perburuhan Sedane (LIPS)

Serikat Buruh Sejahtera Indonesia (SBSI)

Serikat Pekerja Nasional (SPN)

Trade Union Rights Centre (TURC)

You can view a list of campaigns and demands by international civil society organisations demands here.

[This is a live tracker we update on an ongoing basis. If you have additional information on these issues please contact us at [email protected] with the subject line ‘COVID-19 Action Tracker’]