This new government regulation will only be applied in the year 2014. After 2014, the government proposes to base the provincial minimum wage increase on Indonesia's inflation rate and add three to four percentage points to that figure.

Indonesia's Employers Association (Apindo) agrees to the boundary of 20 percent. The association wants to keep the wage increase as low as possible as it is concerned that higher wages become a large burden for employers and impact negatively on industries.

The minimum wages, which are set per province, are currently highest in Jakarta. Compared to 2012, the minimum wage in Jakarta rose 44 percent to IDR 2.2 million (USD $220) per month in 2013. On second place comes resource-rich East Kalimantan. The table below indicates the minimum wage increases from 2012 to 2013 for the five provinces that have the highest minimum wages in the country.

Minimum Wage Increase per Province

 Province       Growth
  2012 to 2013
 DKI Jakarta          44%
 East Kalimantan          49%
 Papua          13%
 West Papua          19%
 Aceh          11%

Source: Ministry of Manpower and Transmigration