HARIANEXPRESS – Indonesia’s Micro, Small, and Medium Enterprises (UMKM) sector continues to be the backbone of the national economy, absorbing nearly 97 percent of the workforce, Friday, (24/7/2026).
Secretary of the Ministry of Cooperatives and SMEs, Loto Srinaita Ginting, stated that UMKM play a highly significant role in Indonesia’s economy. She highlighted that this sector is responsible for 97 percent of job creation nationwide.
Loto further elaborated that the high contribution of UMKM demonstrates their strategic importance in sustaining economic activity. They also play a crucial role in opening up employment opportunities across various regions.
She provided an example from a visit to a micro-business processing boneless milkfish. This particular enterprise successfully employs about 10 to 11 local residents daily for its production processes.
“Jadi, saya melihat memang porsi untuk menyerap tenaga kerja itu nyata, ya, di lapangan, bahwa ini potensial,” stated Loto Srinaita Ginting (Secretary of the Ministry of Micro, Small, and Medium Enterprises (UMKM).
According to Loto, this situation clearly illustrates the substantial potential of UMKM in creating local job opportunities. She emphasized that empowering UMKM must continue to be strengthened to absorb even more workers.
Loto explained that an increase in business scale is also likely to lead to higher wages for employees. Furthermore, it allows for an increased number of workers to be recruited by these enterprises.
The Ministry of Cooperatives and SMEs recorded 30,209,069 business units as of December 31, 2025, based on the Single Data Base of UMKM (BDT-UMKM). Of this total, 30,119,928 units, or 99.70 percent, are micro-enterprises.
Additionally, 73,828 units (0.24 percent) are categorized as small businesses, while 15,313 units (0.05 percent) are medium businesses. Loto pointed out that the dominance of micro-enterprises, accounting for over 95 percent, poses a significant challenge.
This dominance indicates that most business actors still require substantial support to develop and “rise to the next level.” Loto emphasized that such strengthening is vital for their future growth and sustainability.
