Revitalize apprenticeships

Policies Involved

Minister of Manpower Regulation No. 6 of 2020 on the Implementation of Domestic Apprenticeships
Minister of Finance Regulation No.128 of 2019 on The Facility for Human Resources Development in Certain Competencies


Fresh graduates seeking employment in the technology sector lack ​​real-world skills and experiences sought after by employers. Current educational programs often do not provide enough practical training to solve real-world challenges as well as business and organizational skills. As a result, it creates difficulties and delays for newcomers to thrive and excel in the workplace. Aside from a university degree, apprenticeships are an alternative route to the technology sector with an added element of on-the-job training experience. Although a regulation on apprenticeships exists in Indonesia, they are often conducted informally, which may lack structure and do not lead to qualifications1.

Current Policy

The implementation of an apprenticeship program is currently regulated by the Minister of Manpower Regulation No. 6 of 2020 on the Implementation of Domestic Apprenticeships (MoM Regulation 6/2020), which regulates how apprenticeships are being carried out in Indonesia. According to the policy, businesses of all sizes, formal and informal, are able to participate in an apprenticeship program2. Successful apprentices will obtain a certificate of apprenticeship program completion, and may take a competency test to obtain a certificate of work competence3. Further, substantial responsibilities for apprenticeships are placed in the hands of local governments, who are responsible for verifying the apprenticeship agreements, approving the companies’ apprenticeship program application, and for providing mentorship for domestic apprenticeships4.

To incentivize companies to take on apprentices, the Minister of Finance Regulation No.128 of 2019 (MoF Regulation 128/2019) on The Facility for Human Resources Development in Certain Competencies, the implementing regulation to Government Regulation No. 45 of 2019, offers to deduct 200 percent of costs incurred by companies in the implementation of their apprenticeship programs in a number of competencies, including digital economy5. However, digital economy apprenticeship programs are currently limited to partnerships with vocational educational institutions at the diploma level and technical and vocational education training centers (Balai Latihan Kerja or BLK)6 7.


Employers need to play their part in facilitating the career journey of their employees ahead of time if they want to ensure that prospective workers arrive prepared from day one. While existing regulations have offered incentives for companies to take on digital economy apprentices from vocational educational institutions at the diploma level and TVET centers, companies need to be further incentivized to absorb apprentices and graduates from other technology competency programs, such as SMKs and privately-run tech bootcamps. Current incentives should also be evaluated to determine their full impact. Although the MoM Regulation 6/2020 specifies the need for companies to provide instructors for the apprentices, apprenticeship programs should also incorporate peer learning and mentorship in its curriculum8. Partnering apprentices with both a technical expert and a business or managerial expert as mentors can ensure a well-rounded training. The mentors must undergo an appropriate ‘teach the trainer’ coaching program to be qualified to undertake the role. Meanwhile, peer learning is necessary to develop the spirit of collaboration and cooperation - both are important skills in today’s world.

action points
parties involved
Incentivize companies to offer on-the-job training and absorb tech competency program graduates
Ministry of Manpower
Ministry of Communications and Informatics
Ministry of Finance and/or other relevant ministries and agencies
Technology competency programs 
Participating companies
Incorporate peer learning and mentorship in companies’ apprenticeship programs
Ministry of Manpower
Technical expert in the company 
Business or managerial expert in the company
Existing employees 
Train mentors 
Ministry of Manpower
Human Resources Experts 

Indicator of Success

Number of participating apprentices
Number of certified apprentices
Number of participating organizations
Rate of conversion into full-time employment
  1. OECD. (2020). Employment and Skills Strategies in Indonesia.
  2. MoM Regulation 6/2020, Article 1.
  3. MoM Regulation 6/2020, Articles 20-21.
  4. MoM Regulation 6/2020, Articles 10-12, 17, 27.
  5. MoF Regulation 128/2019, Article 2.
  6. MoF Regulation 128/2019, Pages 20-21.
  7. TVET centers (also known as BLKs) are under the coordination of MoM and managed by local governments.
  8. MoM Regulation 6/2020, Article 3.

For many entrepreneurs, the decision to turn into innovations depends on the ease to adopt technology, trained workforces, and multiple sources of finance. Yet, navigating the complex regulation is a major challenge for most lay business people. To expedite the economic recovery post-pandemic recession, the stakeholders in the ecosystem are urged to formulate the right policy to simplify such challenges.

— Kariem El-Ali, Senior Policy Advisor