2027 minimum wage: the formula will follow the Labor Protection Bill, Manpower Minister says — with the legal deadlines for setting it in late November

Indonesia's 2027 minimum wage is now tied to the Labor Protection Bill. Asked on Friday 18 September how the 2027 rate would be calculated, Manpower Minister Yassierli said the ministry had not discussed it yet and that the formula "will depend on what is written in the Labor Protection Bill" — the bill DPR must pass by the end of October under a Constitutional Court deadline (see our separate article). Under the rules in force today, the adjustment is inflation plus economic growth multiplied by an index of 0.50–0.90 (PP 49/2025), provincial minimum wages must be announced by 21 November and district/city minimum wages by 25 November, and all take effect on 1 January. Last year the formula regulation itself only arrived on 17 December and moved the 2026 deadline to 24 December. For anyone budgeting 2027 payroll, that is the practical point: the number may again come late.

Key points

• 18 September, at the Statistics Indonesia (BPS) office in Central Jakarta, Minister Yassierli: "We haven't discussed that yet. Right now we are focused on the Labor Protection Bill." On the formula: it "will depend on what is written in the Labor Protection Bill," and "we'll see in the law how far the formula is regulated, then we base it on that." On timing: "We don't know yet."
• The formula in force today — PP 49/2025, the second amendment to PP 36/2021 on wages, established and promulgated on 17 December 2025: minimum-wage adjustment = {inflation + (economic growth × α)} × the current minimum wage, with α set between 0.50 and 0.90. The previous rule, PP 51/2023, used a range of 0.10–0.30.
• Statutory deadlines under the current rules: provincial minimum wage (UMP) set by governor's decree and announced by 21 November (PP 51/2023, Article 29); district/city minimum wage (UMK) by 25 November (PP 49/2025, amending Article 35); a provincial sectoral minimum wage within five days after the UMP. All take effect on 1 January. Some media have cited 1 November and 10 November for 2027; we could not find those dates in the regulations.
• Precedent: for 2026, PP 49/2025 arrived on 17 December 2025 and, by a transitional provision, moved the deadline for all 2026 provincial, district/city and sectoral minimum wages to 24 December 2025 — a week before they took effect. The regular November deadlines were overridden.
• Sectoral minimum wages are back: PP 49/2025 re-established provincial and district/city sectoral minimum wages, set on the recommendation of the wage councils for specific sectors.
• What the draft bill says, as reported: minimum wages, sectoral minimum wages and wage scales set by a formula tied to economic conditions. The formula itself in the draft has not been published in a form we could verify.
• Union positions, not forecasts: KSPI president Said Iqbal proposed on 17 September that 2027 minimum wages rise by 7.5% to 9.5%, citing average inflation of 3.20% and growth of 5.43% (October 2025–August 2026) with α at the top of the range; the KSPSI-led coalition is separately demanding a stronger wage council in the bill.

Sources

• JDIH Kemnaker — Peraturan Pemerintah Nomor 49 Tahun 2025 (second amendment to PP 36/2021 on wages; primary source: formula, α range, 25 November UMK deadline, 2026 transitional deadline)
• BPK — PP No. 51 Tahun 2023 (Article 29: provincial minimum wage announced by 21 November)
• CNBC Indonesia — Ditanya Formula Upah Minimum 2027, Menaker Yassierli Jawab Begini (15:05 WIB, 18 September)
• Bisnis.com — Menaker: Formula UMP 2027 Tunggu RUU Pelindungan Ketenagakerjaan Rampung (16:01 WIB, 18 September; remarks at BPS)
• periskop.id — KSPI Usul Kenaikan Upah Minimum 2027 Sebesar 7,5 Hingga 9,5% (17 September; Said Iqbal)
• Pajakku — Aturan Upah Minimum Terbaru dalam PP 49/2025: Nilai Alfa Berubah, Formula Tetap (α range widened from 0.10–0.30)