In some countries, government encourages industries and business to move from large cities to regional areas. Do you think the advantage outweighs the disadvantages?

Globalization era was changed dramatically from industries based on human resources to machine era after revolution industries happened in Britain yard. According to the first invention of steam machine, all industries companies have already moved to better condition like this recent era. In addition, government in all countries takes responsibilities to encourage industries and business companies to regional areas for getting more benefit. Nevertheless, some companies believe if this argument will not give more benefit for companies because some reasons. Both of them are so close to reality these case, it will not be fare to conclude immediately. Personally, I am in favor of the former view to explain reasons from both of them.

Obviously, the revolution of industries has started sharply in Britain yard since 1769 when James Watt discovered first steam machine. This revolution was being the first baseline of industrialization pathway to all over countries in the world, including Indonesia. Thus, over two hundred years after this revolution, Indonesia has already run the new era also in modern of industry. Therefore, Jakarta as the capital town of Indonesia plays important games of industries. In addition, most of big companies have their branch offices in Jakarta as a sign that they join in this trade. Hence, this condition impacts to government that they have to replace the companies to regional areas for increasing the benefits. Secondly, these government regulations perhaps give more chances to other citizen in regional areas. Thirdly, the companies think differently by rejected that rules because some reasons. Lastly, companies are an important player who serves the consumer for getting affordable price.

On the other hand, willingness of Jakarta government to relocate some industries to peripheries area was triggered by willingness of labors that ask an increasing of minimum salary standard. Indonesian Chamber of Commerce and Industry, Mr. Suryo Bambang Sulisto, was explained that more than 30 big companies would relocate their places if the Government of Jakarta agreed of an increasing of minimum salary standard for labors. Moreover, minimum salary standard for Jakarta’s labor is over than 2 million rupiah and this condition contrast a half with these labors in remote area. The companies thought differently for this rules because rose of labor salary meant to increase a price for consumers. The Government of Jakarta only thought separately by only thinking how to give more jobs to other citizens in other regional area without thinking how big money will relocate for running the industrialization wheels. The companies rejected to increase labors salary, then, they better to find a cheaper labors in other places. Labors were important things in companies that affect the wheels of companies. The more pleasure giving to labors, the more money out from company’s pockets. Certainly, that meant of decreasing the benefit of companies. This long chain will trigger companies to raise the price in market, as a result, consumer will buy some stuff with higher price than usual.

What is more, as far as I am concerned to this issue, government handles an important circumstance of balancing of political issue of labors. In fact, government imposes labors by regulating a new minimum salary standard. Conversely, companies against it and relocates their work to peripheral area is not the best choice. Possibly, companies prepare some cities as a replacement such as Central Java and East Java to find a half minimum salary standard in level 1, 5 million rupiah. By comparison, these conditions lead to stable the price in community so the markets still keep up the existence.

To put them in a nutshell, I think the government should create a fair regulation of labors salary not only in Jakarta but also in other regional cities for balancing a rhythm of economic wheels. This is an essential regulation that manages the industries when they move their companies to remote area. To sum up, both government and companies should work together and find the best solution for this case.