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Paving the Way for a Thriving Digital Economy in Indonesia

Petra Wiyakti Bodrogini's picture
Also available in: Bahasa Indonesia



Across the digital economy in Indonesia, both IT giants and smaller companies have the same complain: digital talents are hard to find. Obert Hoseanto, an Engagement Manager from Microsoft Indonesia, said the company recently contracted only five people for an internship program, out of a pool of hundreds of applicants.

But those applying for jobs are also struggling, with many realizing the difficulties of meeting the needs of their employers. Natali Ardianto is learning the ropes at tiket.com, a thriving start-up, “by doing”, he said. “Only 30% of the curriculum of my education was useful for the company I joined,” he explained.

A recent workshop held by the Coordinating Ministry of Economic Affairs and supported by the World Bank strived to develop a better understanding of this skills gap, by bringing in insights from the private sector, education experts, and global practitioners.

Our research supports our recommendation that Indonesia needs to close these gaps. The preliminary findings of an ongoing study on ICT skills show that while Indonesia has made progress on the ICT Development Index, skills must be enhanced through overall education performance as well as ICT skill acceleration programs. Referencing the ICT nomenclature of Organization for Economic Co-operation and Development (OECD), the study reveals an important but often overlooked gap – that of complementary skills such as the soft skills of leadership and communication, and familiarity with business marketing.

So, how do we nurture the right digital talents? Strategies, says the private sector, should include additional training and internships, collaboration with local communities, and tapping the expertise of international professionals. Tiket.com collaborates with local initiatives such as capacity enhancer Pondok Programmer to train young people as programming engineers. Online-based transport company Go-Jek recruited international professionals to teach at one of their research centers outside Indonesia.



State-owned enterprises also see that corporate culture and values must adapt. State-owned telecommunications firm Telkom sends their staff abroad for training and learning international best practice. Bank Rakyat Indonesia (BRI) uses a talent accelerator framework to nourish creative talks and offer digital master classes as well as digital immersion programs.

Vocational education is also getting more attention. The Ministry of Education and Culture is developing a roadmap on vocational high school development for local governments to pursue. The Ministry of Research, Technology and Higher Education is working to carry out Higher Education 4.0, where learning takes place in a networked society and takes advantage of digital technologies. Upskilling programs for the workforce, focusing on IT, infrastructure, health, and digital retail industries, are being rolled out by the Ministry of Manpower. The Ministry of Communication and ICT has also developed an ICT occupational map to guide the development of ICT skills and the certification process.  

Though these efforts are encouraging, more options are available to speed up digital development.

First, government regulations and programs can align better with the proposed roadmap for digital skills development. Public-private partnerships can support this agenda, so they should be strengthened.

Second, consider innovative solutions. Our neighbors offer plenty of examples. From Malaysia’s Digital and E-commerce Center, established to help manifest the vision for Digital Malaysia, to the Philippines’ IT-BPM Road Map and the partnership between the tech industry and the education community for digital literacy, and similar partnerships between multiple industries supporting Thailand’s comprehensive digital strategy, the region is rife with promising programs. More focused on digital skill development programs, Singapore’s Skills Future initiative also offers a clear framework and pathways for the upgrading of workforce skills.

Third, ask the customers. Demand drives the private sector’s approach towards skills development. Intel’s innovation incubators and ‘makershare’ initiative is community-based and provides options for national agencies and local governments. Go-Jek works with international professionals and educators to strengthen computer science teaching and learning, and suggests also to incentivize experienced Indonesian ICT professionals working abroad to return home.

After all, if Indonesia fulfills its potential as the world’s seventh largest economy by the year 2030 and the fourth largest by 2050, the country’s digital economy may offer as many opportunities as any overseas.