Indonesia Sets 2026 Minimum Wage: Regional Disparities Highlighted

Significant Variations Across Provinces

Indonesia has announced its provincial minimum wages (UMP) for 2026, revealing significant regional disparities. DKI Jakarta remains the highest at Rp 5.729 million while West Java has the lowest at Rp 2.317 million ³

. The figures show a wide gap in minimum wage standards across the country.

Jakarta's Minimum Wage Details

The Jakarta government, led by Governor Pramono Anung, announced a 6.17% increase in the UMP for 2026, bringing it to Rp 5.729.876 ²

. This decision was made after considering economic conditions, purchasing power, and business sustainability. The Jakarta UMP increase was implemented following discussions with various stakeholders, including business representatives and labor unions.

Bekasi's Higher Minimum Wage

Interestingly, Bekasi City's minimum wage (UMK) for 2026 stands at Rp 5.999 million, surpassing Jakarta's UMP ¹

. Financial experts speculate that this higher rate might be due to Bekasi's status as an industrial hub with higher living costs. The West Java governor's decision on UMK rates across the province showed significant variation, with Bekasi being the highest and Banjar City the lowest at Rp 2.361 million ⁴

Source 4

https://finance.detik.com/berita-ekonomi-bisnis/d-8277981/daftar-umk-di-jabodetabek-bekasi-hampir-rp-6-juta

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National Context and Regulatory Framework

The minimum wage setting for 2026 follows Government Regulation No. 49/2025, which mandates governors to announce UMP rates by December 24, 2025 ⁶

. The regulation considers factors such as national economic conditions, inflation, and decent living needs. The formula for UMP adjustment includes inflation plus (economic growth x alpha), where alpha ranges between 0.5 and 0.9 as determined by the Ministry of Manpower.

Regional Comparison

Other provinces have also announced their 2026 UMP rates. Banten province, for instance, has set its UMP at Rp 3.100 million, representing a 6.74% increase ⁴

. The data shows that while Jakarta maintains the highest UMP, several other regions have rates significantly lower than the capital.

Implications and Reactions

Labor unions have expressed mixed reactions to the new rates. While some acknowledge the increase, others argue that the rates remain below the decent living standard as defined by the Ministry of Manpower ⁵

⁶

Source 6

https://nasional.kontan.co.id/news/daftar-lengkap-ump-umk-ums-riau-2026-banyak-yang-dibawah-khl

. The government maintains that the rates balance worker protection with business sustainability.