Tariff War Alert: Impact of US Tariff Policy on Jobs in Indonesia

The U.S. import tariff policy implemented by President Donald Trump is raising concerns across various sectors. Starting March 12, 2025, tariffs on steel and aluminum will increase from 10% to 25%. Minister of Economic Affairs, Airlangga Hartarto, emphasized that while Indonesia is working to mitigate the effects by diversifying export destinations and strengthening industrial resilience, these tariffs still pose a significant risk to exports and employment. If the situation escalates, Indonesia could face mass layoffs, hiring freezes, and delayed foreign investments.

Global trade policies like these don’t just affect numbers on a balance sheet—they shape the future of work. As market dynamics shift, businesses in Indonesia must stay agile to protect their workforce and maintain operational resilience.

Industries Most Affected & Thriving

Labor-intensive industries such as textiles, electronics, and automotive face a high risk of declining production and efficiency due to these increased tariffs. Rising import costs for raw materials increase the production burden, making companies in these sectors more likely to reduce their workforce or freeze new hiring.

On the other hand, sectors like renewable energy, healthcare, and e-commerce remain stable or even thrive due to ongoing innovation and growing market demands.

Understanding these trends is crucial for companies to anticipate workforce needs and mitigate risks. The ability to respond swiftly to industry disruptions will be a key differentiator in the coming months.

What Can Companies Do?

To navigate this uncertainty, companies in Indonesia are advised to take proactive steps, including:

1. Reskilling & Upskilling: Focus on retraining and enhancing skills in technology and supply chain fields to prepare the workforce for market changes.
2. Strategic Workforce Planning: Develop comprehensive workforce planning to map out future talent needs and ensure business continuity amid global shifts.
3. Market Diversification: Explore new markets to reduce reliance on traditional export destinations and strengthen business relationships both domestically and internationally.
4. Partnering with Recruitment Companies: Collaborating with employment agencies or headhunters in Indonesia is an effective solution for finding quality talent aligned with evolving business needs.

RecruitFirst Indonesia’s Role in Helping Businesses Adapt

Amid global policy changes, having a recruitment partner who understands labor market dynamics is crucial for success. As one of the leading recruitment companies in Indonesia, RecruitFirst Indonesia is ready to help businesses navigate these challenges by providing tailored recruitment solutions for each industry’s unique needs.

With our expertise in recruitment strategies and workforce placement, we support businesses in finding the best talent to drive future growth. Our services include:

• Professional recruitment across various industries
• Strategic workforce planning consultation
• Support for workforce reskilling & upskilling

Don’t let global challenges hinder your business growth. Contact us at RecruitFirst Indonesia and discuss how we can assist with your company’s recruitment needs.

With the right steps and a reliable partner, your company can withstand and thrive amid global uncertainties.