Recruitment In Indonesia: Hiring Managers

The ability to attract high quality people to your company is often the separator between companies who succeed big time and who fail in Indonesia. Despite population of 240 million, attracting the best players to work for you can be challenging.

In this article I will share market insights and  Indosight’s own experience in headhunting mid and senior level managers.

Recruitment in Indonesia as a key challenge

Castle Asia conducted a study about biggest obstacles to daily operations and business growth in Indonesia. Here are the results:


As you can see from the table above, 8 out of 9 major challenges in growing a business in Indonesia are directly related to workforce. Finding management staff even beated inconsistent regulations as the biggest challenge.

Another employment study by Monroe Consulting Group found the following:


The conclusion is very obvious: Indonesia has a huge supply of unskilled and low skilled workforce and finding staff from those segments is easy. The challenge however is finding great people to the mid and senior level.

Let’s look more closely why getting top people is such as challenge in Indonesia.

Reasons behind lack of quality workforce

Recruitment Indonesia is challenging due to education level

photo credit

Education system is not competitive

According to Programme for International Student Assessment (PISA), Indonesian students rank among the worst in the world. Out of 74 countries ranked in 2009’s study, Indonesia ranked the following:

  • Maths: 68th out of 74 countries
  • Sciences: 66th
  • Reading: 62nd

See full table here.

The challenge is not only the poor level of education, it is also the accessibility. According to World Bank statistics, net enrollment rate in secondary education is only 58%, leaving millions of Indonesians without proper education.

Family owned businesses

Indonesia is a very family-centered society and not surprisingly this results in family owned companies dominating the business scene. Naturally the children of the wealthy are the ones who receive best education and are prepared by their families to be able to run multimillion dollar businesses.

Hiring the members of those wealthy families is almost impossible – families make sure that their kids end up taking over their businesses.

Multinational companies take the rest of the top talent

Prestige is extremely important to Indonesians. Working for an employer that increases their social status is extremely desirable. Therefore multionational companies are attracting the best people available in the market.

How to attract quality managers


photo credit

Indosight consultants have been in the recruitment business since 2006 and from 2011 we have been finding managers to Indosight’s clients. Here are our key lessons we have learned over the year about how to attract the best people:

1# Pay bigger salary than the market average

Often foreign investors expect to come to Indonesia and find extremely low salary levels. While it’s easy to find an assistant for 3 million Indonesian Rupiah (~320 USD) per month, if you want people with skills, responsibility and initative, you need to pay them much more.

The good news is that unless you are in oil and gas industry, the salaries are still significantly lower than in developed countries. Just not as low as you would expect.

2# Create prestigious working environment

As mentioned before, social status is extremely important to Indonesians, so think how your company can utilize that. Here are some ideas:

  • Invest in renting office in a prestigious area – location matters a lot, especially in the bigger cities
  • International exposure – show how the job roles give the person international interactions  and opportunities
  • Treat your current employees well – they will become your sales agents for attracting more talented people to work for you

3# Use your network not job portals

Indonesia has a lot of job portals, such as JobsDB and dozens of other. Most of them have thousands of job offers and seekers, which might give an impression that they are effective way to recruit new employees.

The challenge as a recruiter is that the supply and demand are out of place. For lower skilled jobs, there is an over-supply, and getting people is very easy. But people with high skills are not using job portals to find jobs. They get already targeted by so many companies directly that they can just choose for whom they want to work for.

Therefore while it may be worth to try the job portals, most probably you will find best people through your own and your local partners networks. What if you don’t have access to such networks? Then hire a headhunting firm with solid track record.

Featured photo credit


Market entry services in Indonesia

Indosight provides legal and payroll services to companies entering and expanding in Indonesia. Get in touch with our consultants regarding our company registration, payroll, compliance or visa services.

The information provided will remain confidential to Indosight and will only be used to schedule and prepare for the meeting.

Leave a Reply

Your email address will not be published.

Related articles

Finding office in Jakarta
Guide To Finding Office In Jakarta

2016 is great time for finding office in Jakarta since the demand for office space in the Indonesian capital Jakarta has been outpacing demand. The vacancy rate for Jakarta office market rose from 4.8% in 2014 to 8.4% in June 2015. For grade A office spaces the change has been even more dramatic – it […]

Labor Costs And Employment Culture In Indonesia

Some labor costs in Indonesia can come as a surprise to foreign business leaders – many due to not being familiar with the law, others due to cultural differences. This article will teach you the ABC’s of labor costs and employment culture in Indonesia. Whether a company hires most of its staff locally or from […]

Permanent Business License
Why You Should Get Permanent Business License for Your PT PMA

After the lengthy incorporation process you might expect that you’ve managed to beat the bureaucracy and your company is finally set to conquer the Indonesian market. But there is one license every business still needs to acquire – permanent business license. Let’s look more closely what is it and why you will want to get […]

Company restructuring
Company Restructuring in Indonesia

If you’ve talked with Indosight consultants, which you probably have, you’ve heard us saying things like “be clear about your location, business activities, shareholders etc. from the beginning”. There’s a good reason for that. Making changes in your company activities, location or shareholders all require a considerable amount of time and legal paperwork. However, most […]

large__7689519998 cropped
Investment Activity Report to Investment Coordinating Board

All most people know about the Investment Activity Report or LKPM when turning to us is that it is an extra burden on their company and that it takes time. Think of LKPM as brushing your teeth: it doesn’t take long and if done regularly and correctly, it keeps major problems away. This article provides […]

Setting Up Factory (Manufacturing) In Indonesia

In order to set up factory in Indonesia a company has to go through three stages – (1) company incorporation, (2) construction and (3) permanent business license. What many investors are not fully aware of is that Indonesian government favors manufacturing investments and offers several incentives for companies doing so.