IT IS ESTIMATED that by the early 2020s, young adults aged 20 to 40 will dominate the job market. The high birth rate during the baby boom era has made the population explosion in this century unstoppable. This can be both an opportunity and a threat for us as the younger generation who are experiencing the so-called demographic bonus. If we can harness this abundant workforce, Indonesia will become a superpower like China or collapse due to too many unemployed workers. The Millennial generation, born around the 90s and present, are the ones who should be driving the country's economy during the demographic bonus era. We are the ones who bear the brunt of the economic prosperity or bleakness that occurs during that era. Unfortunately, 40 percent of this generation still has an elementary school education, and less than 20% have a bachelor's degree. Therefore, it can be predicted that the majority of Indonesia's workforce will be unskilled labor, aka uneducated workers.
If the majority of the workforce is uneducated, it will certainly pose a problem for driving the economy, especially in the digital era when technology is starting to replace unskilled labor. Of course, it's not the unskilled who can drive the startups that are starting to emerge in Indonesia. So, how do we address this problem?
Indonesia needs to emulate China and Japan in leveraging their populations to drive the economy. The 1945 bombing of Hiroshima should have caused the Japanese economy to plummet, given that the city was a center of Japanese research. However, Japan reversed this trend in the 1960s, when Toyota displaced Ford in the American market.
This was due to Japan's successful post-World War II baby boom. Infrastructure and education were fully facilitated by the Japanese government, and the culture of kaizen, or gradual improvement, was promoted among its citizens. The population's strong sense of nationalism also helped accelerate development.
China is no different; its population of over 1 billion people hasn't been overwhelmed by unemployment. The government has opened up massive business opportunities. Domestic businesses are heavily protected by minimizing
imports and raising barriers to entry for foreign entrepreneurs. This is also supported by the Chinese people's entrepreneurial spirit, which has been passed down through generations. Today, China has the highest GDP in the world due to its utilization of human resources. Until now, we have relied heavily on the oil and gas sector in our economy. Indeed, the oil and gas sector is the second-highest contributor to the country's GDP.
However, oil and gas is not a sector that can be relied on long-term. This is because it cannot be produced quickly and easily. Therefore, we need to steer our economy toward sustainable industries and utilize our large unskilled labor force. Otherwise, mass unemployment will occur, which will have significant negative impacts on the social sector.
Unaddressed unemployment will lead to social problems, ranging from crime, declining interest in education, and increased prostitution. For example, South Africa had an unemployment rate of 26% in 2018. Its citizens are willing to "sell themselves" just to get a bite to eat. Naturally, if this becomes a necessity, other deviant behavior will also be done to meet needs. Shortcuts such as gambling, selling drugs, and even robbery will become rampant. The business and industrial sectors are one role that educated workers can play in creating jobs for the demographic bonus era. Limited skilled labor in Indonesia cannot simply wait and compete for positions provided by others. If we rely solely on government and private sector employment, population growth will certainly far outstrip job availability, resulting in a crisis affecting all levels of society. Starting a business early is one step we, as educated workers, can take to prevent this problem from arising in the future. Certainly, by creating jobs, we also help the government successfully capitalize on the demographic dividend era. This has been demonstrated by one of Indonesia's recent digital startups.
According to a 2017 survey by the Central Statistics Agency (BPS), unemployment in Indonesia decreased by 508,000 people. Approximately 200,000 of them are partners of Go-Jek, one of Indonesia's online motorcycle taxi startups. Besides solving the problem of motorcycle taxi drivers spending 70% of their time waiting, Go-Jek also addresses the problem of uneducated unemployment in Indonesia, as driving doesn't require a high school or college diploma.
Of course, it's not just motorcycle taxi drivers who are feeling the benefits. The presence of Go-Jek, which provides additional features such as Go-Food, has also helped tighten the belt of the street vendor and food industry. Reported from an article in industri.bisnis.com, there are around 35,000 Go-Food partners who have collaborated and are spread across 15 cities throughout Indonesia. Of course, it's not just motorcycle taxi drivers who are feeling the benefits. The presence of Go-Jek, which provides additional features such as Go-Food, has also helped tighten the belt of the street vendor and food industry. Reported from an article in industri.bisnis.com, there are around 35,000 Go-Food partners who have collaborated and are spread across 15 cities throughout Indonesia.
The government also provides extensive support for individuals with an entrepreneurial spirit but limited capital. This is evidenced by the Student Creativity Program Competition and the Student Entrepreneurship Program, which are widely promoted in universities. The government hopes that many students will eventually become business owners and contribute to the global economy.
Reported from beritasatu.com, there is another program supported by the Ministry of Foreign Affairs by collaborating with a youth organization called IYP (Innovative Youth Project) which has been held since 2011. "I appreciate the holding of this event which is a forum for connectivity and networking of Indonesia's leading young entrepreneurs, especially the participants of the Outstanding Student for the World (OSTW) 2016 program," said Agus, Secretary of the Ministry of Cooperatives and SMEs. Of course, there is no longer any reason for us not to start entrepreneurship early. In addition to full support from the government, Indonesia also needs our roles as an educated generation to help drive the wheels of the economy and overcome unemployment. So, what other reasons are there not to start a business, guys? (Danang Rizky Nugroho)
Source: B-Magz FEB Unair vol-1