The document summarizes information about recruitment in Indonesia. It discusses Indonesia's growing economy and population as well as talent demand and supply challenges. There is a shortage of middle managers by 2020 due to weak education historically and limits on foreign talent. Technology is changing the market by reducing unskilled labor needs but creating new jobs. Employees are less engaged and more likely to casually look for jobs. Running a recruitment business in Indonesia requires various licenses. Executive search has shifted from retained to contingent models with more project-based work and restrictions on outsourcing.

1. ASIA PACIFIC RECRUITMENT SUMMIT 2014
Marina Bay Sands, Singapore
1-2 October 2014
THE GLOBAL RECRUITER

2. TODAY MENU
• Indonesia Today
• Driving Forces in Recruitment
• Market Situation in Indonesia
• Operating Recruitment Business in Indonesia
• Current Executive Search Practice

3. INDONESIA TODAY
• Population: 249,865,631 (2013) *
• Part of G20
• GDP Growth: 6.3% (2012), 5.8% (2013), no
negative growth in last 5 years trend *
• Major challenges: corruption, legal system,
infrastructure, education, healthcare
• Key sectoral opportunities: infrastructure, food
and agriculture, energy, manufacturing/industry**
*) source: www.worldbank.org
**) source: www.bkpm.go.id

4. Talent Demand:
- Foreign Direct
Investment (FDI)
- Business/economic
growth
- Organization
Development
Talent Supply:
- Education & Development
- International Talents
Current Market Changer:
- Technology
TALENT
MARKET
Foreign
Direct
Investment
BUSINESS
GROWTH
ORG
DEV
TECHNOLOGY
EDUCATION
AND
DEVELOPMENT
FOREIGN
TALENT

5. General Market Condition
• “Short supply, over-demanded” talent market due to high
economic growth, FDI, OD
• Lack of acceleration on talent supply due to:
– weak education system at the past and
– international talents limitation
• Technology is main “game changer”: automation reduce the
needs of unskilled labors, but also creating new type of
business/profession
• Shorter employment period and higher employee turnover
• Philosophy of employment is more on “free market
mechanism”, the end of whole life time employment
• The best employees are the most vulnerable talents to be
retained (see talent behavior slides)

6. TALENT GAP IN INDONESIA
In 2020, Indonesia will
face major shortage at
middle management level
(56%)
Source: BCG report

7. Talent Behavior, some facts
• Indonesia employee engagement *)
– Engaged: 8% VS 13% (global #) VS 12% (south east asia)
– Not Engaged: 77% VS 63% (global #)
– Active disengaged: 15% VS 24% (global #)
• Active & Passive talents in the country **)
– Actively looking - 15% VS 12% (global avg)
– Casually looking a few times a week – 14%
– Reaching out to personal network – 20%
– Open to talking to recruiter - 41%
– Completely satisfied, no willing to move – 10% VS 15% (global avg)
• Top reasons to move/change the job **)
– Active candidate: better compensation and benefit; more challenging work, better
quality company
– Passive candidate: better compensation and benefit; better work/life balance,
opportunities for advancement
*) source: Gallup – State of the Global Workplace report
**) source: Linkedin – Talent Trends 2014 report

8. RUNNING RECRUITMENT BUSINESS

9. Type of Recruitment License in Indonesia
Getting Recruitment License
• In general recruitment company requires special (operational) license,
from Indonesia Man-power Minister
• License need to be renewed for certain period of time, and approved by
man-power department, by considering their level of compliance and
performance
Private workers placement
company (LPTKS) Assist client to hire workers/executives for private company
Manpower agency for
foreign placement (PJTKI)
Perform Indonesian -talent placement in overseas market
Agency for worker/labor
(Outsourcing)
Do outsourcing business for their clients

10. EXECUTIVE SEARCH PRACTICE

11. Past & Present
PAST PRESENT
• Retained based search
assignment
(project/hourly based)
• Strong commitment by
both Client & HH
• Only using 1 HH for 1
assignment
• Outsourcing practice was
without restriction
• Most assignments:
contingency based
• Probable for lack of
commitment on both
sides (Client & HH)
• Using >1 HH for 1
assignment
• Starts on “RPO” projects
• More restriction on
outsourcing
Note: Few international HHs still have luxurious to provide retained search. Some contingent search
firms also started
offer retained search

12. We are executive search company, incorporated in 2002, serving
mainly our clients in Indonesia, ASEAN countries and other Asia
Pacific region. Industrial expertise: FMCG, Pharmaceutical,
Technology, Telecommunication and Manufacturing. Hiring
manager – director level for top multinational companies