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Medan – North Sumatra Governor Bobby Nasution welcomed input from the Indonesian Chamber of Commerce and Industry (KADIN) North Sumatra and the Indonesian Employers Association (APINDO) North Sumatra regarding the planned increase in the provincial minimum wage (UMP) for 2026.

“We received various inputs from business representatives concerning the determination of the UMP, which remains a major concern for both employers and workers in North Sumatra,” said Bobby after meeting with the leadership of KADIN and APINDO North Sumatra at the Governor’s Office in Medan, on Tuesday.

The Governor stated that the North Sumatra Provincial Government (Pemprov Sumut) is still awaiting further instructions from the central government regarding the mechanism for determining next year’s UMP. For 2025, the provincial government had already set the UMP based on Minister of Manpower Regulation No. 16 of 2024 on the Determination of the 2025 Minimum Wage.

Overall, the 2025 UMP for North Sumatra rose by 6.5 percent, or IDR 182,644, reaching IDR 2,992,559 compared to the 2024 rate. This was stipulated in Governor’s Decree No. 188.44/807/KPTS/2024 on the 2025 UMP of North Sumatra, dated December 6, 2024.

“As we all know, last year’s UMP determination came directly from the central government. This year, we are still waiting to see whether the mechanism will remain the same,” Bobby explained.

He further emphasized the importance of constructive dialogue between employers and workers in determining fair wages, taking into account both national and global economic conditions. Responding to labor groups in North Sumatra who have proposed an eight percent increase for 2026, Bobby said the request is still feasible.

“I think this is possible. Employers could reallocate costs from other sectors to support higher wages for workers,” he said.

The Governor reaffirmed that the provincial government would continue to provide open channels for dialogue and consultation to find a balanced solution that does not disadvantage either party. “We hope the final decision will maintain harmony between workers’ welfare and business sustainability in North Sumatra,” he added.

Meanwhile, KADIN North Sumatra Chairman Firsal Dida Mutyara noted that the organization has coordinated with multiple industrial sectors to assess the potential impact of the proposed wage increase on production costs.

“If the increase reaches eight percent, the industrial sector will be the most affected due to significant additional costs. However, the plantation sector and others may not experience as much impact,” Firsal said.

He also urged that discussions on the provincial minimum wage be conducted further in collaboration with all stakeholders. “Additionally, we conveyed concerns about industrial security in several areas, such as Belawan, which remains prone to disturbances that could affect economic growth in North Sumatra,” Firsal concluded.

Source: Antaranews.com