Revitalize apprenticeships

Policies Involved

Renovation

Minister of Manpower Regulation No. 6 of 2020 on the Implementation of Domestic Apprenticeships

Minister of Finance Regulation No.128 of 2019 on The Facility for Human Resources Development in Certain Competencies

Challenge

Fresh graduates seeking employment in the technology sector lack real-world skills and experiences sought after by employers. Current educational programs often do not provide enough practical training to solve real-world challenges as well as business and organizational skills. As a result, it creates difficulties and delays for newcomers to thrive and excel in the workplace. Aside from a university degree, apprenticeships are an alternative route to the technology sector with an added element of on-the-job training experience. Although a regulation on apprenticeships exists in Indonesia, they are often conducted informally, which may lack structure and do not lead to qualifications¹.

Current Policy

The implementation of an apprenticeship program is currently regulated by the Minister of Manpower Regulation No. 6 of 2020 on the Implementation of Domestic Apprenticeships (MoM Regulation 6/2020), which regulates how apprenticeships are being carried out in Indonesia. According to the policy, businesses of all sizes, formal and informal, are able to participate in an apprenticeship program². Successful apprentices will obtain a certificate of apprenticeship program completion, and may take a competency test to obtain a certificate of work competence³. Further, substantial responsibilities for apprenticeships are placed in the hands of local governments, who are responsible for verifying the apprenticeship agreements, approving the companies’ apprenticeship program application, and for providing mentorship for domestic apprenticeships⁴.

To incentivize companies to take on apprentices, the Minister of Finance Regulation No.128 of 2019 (MoF Regulation 128/2019) on The Facility for Human Resources Development in Certain Competencies, the implementing regulation to Government Regulation No. 45 of 2019, offers to deduct 200 percent of costs incurred by companies in the implementation of their apprenticeship programs in a number of competencies, including digital economy⁵. However, digital economy apprenticeship programs are currently limited to partnerships with vocational educational institutions at the diploma level and technical and vocational education training centers (Balai Latihan Kerja or BLK)^{6 7}.

Action

Employers need to play their part in facilitating the career journey of their employees ahead of time if they want to ensure that prospective workers arrive prepared from day one. While existing regulations have offered incentives for companies to take on digital economy apprentices from vocational educational institutions at the diploma level and TVET centers, companies need to be further incentivized to absorb apprentices and graduates from other technology competency programs, such as SMKs and privately-run tech bootcamps. Current incentives should also be evaluated to determine their full impact. Although the MoM Regulation 6/2020 specifies the need for companies to provide instructors for the apprentices, apprenticeship programs should also incorporate peer learning and mentorship in its curriculum⁸. Partnering apprentices with both a technical expert and a business or managerial expert as mentors can ensure a well-rounded training. The mentors must undergo an appropriate ‘teach the trainer’ coaching program to be qualified to undertake the role. Meanwhile, peer learning is necessary to develop the spirit of collaboration and cooperation - both are important skills in today’s world.

action points

parties involved

Incentivize companies to offer on-the-job training and absorb tech competency program graduates

Ministry of Manpower

Ministry of Communications and Informatics

Ministry of Finance and/or other relevant ministries and agencies

Technology competency programs

Participating companies

Incorporate peer learning and mentorship in companies’ apprenticeship programs

Ministry of Manpower

Technical expert in the company

Business or managerial expert in the company

Existing employees

Train mentors

Ministry of Manpower

Human Resources Experts

Indicator of Success

Number of participating apprentices

Number of certified apprentices

Number of participating organizations

Rate of conversion into full-time employment

Repatriate Indonesian tech talent

OECD. (2020). Employment and Skills Strategies in Indonesia. https://www.oecd-ilibrary.org/employment/employment-and-skills-strategies-in-indonesia_dc9f0c7c-en
MoM Regulation 6/2020, Article 1.
MoM Regulation 6/2020, Articles 20-21.
MoM Regulation 6/2020, Articles 10-12, 17, 27.
MoF Regulation 128/2019, Article 2.
MoF Regulation 128/2019, Pages 20-21.
TVET centers (also known as BLKs) are under the coordination of MoM and managed by local governments. https://blogs.worldbank.org/sites/default/files/preparing_ict_skills_for_digital_economy-revised_7mar2018.pdf
MoM Regulation 6/2020, Article 3.

Quantitative Demographics

Gender Distribution

Highest Education Attainment

Owner's Age

Marital status

Number of Dependent(s)

Qualitative Demographics

Education

Gender

SEC

Industry

Size

Age

Codesign Demographics

Gender Distribution

Category Distribution

Revitalize apprenticeships

Policies Involved

Challenge

Current Policy

Action

Indicator of Success

Repatriate Indonesian tech talent

Provide non-monetary incentives for potential students to study tech