Jakarta. Indonesia’s investment realization reached Rp 1.93 quadrillion ($107.57 billion) in 2025 and continued to grow in the first half of 2026, but the expansion has yet to translate into formal job creation at a comparable pace, think tank CORE Indonesia has warned.

The Investment Ministry (BKPM) recorded Rp 1,931.2 trillion in investment realization in 2025, up 12.7% from the previous year. The figure exceeded the government’s target of Rp 1,905.6 trillion and generated 2.71 million direct jobs.

The upward trend continued in the first half of 2026, with investment realization reaching Rp 1,010.6 trillion, up 7.2% year-on-year. The figure represented 49.5% of the government’s full-year target of Rp 2,041.3 trillion. The investment absorbed 1,448,862 Indonesian workers, a 15% increase from the same period last year, according to BKPM.

However, CORE Indonesia executive director Mohammad Faisal said investment growth alone was insufficient to assess the quality of capital inflows, pointing to the need to measure their capacity to generate formal employment.

“However, investment quality does not always move in line with investment value,” Faisal told the Jakarta Globe on Sunday.

Data from Statistics Indonesia (BPS) showed that the country had 147.67 million employed people in February 2026, an increase of around 1.90 million from February 2025. Of that total, approximately 59.93 million worked in the formal sector, while 87.74 million were employed informally.

This means formal workers accounted for around 40.6% of total employment, compared with 59.4% in the informal sector. Informal employment includes own-account workers, casual workers and unpaid family workers who do not fall under the formal employment category.

“Our workforce structure still consists of 59% informal workers and 41% formal workers,” Faisal said.

He added that rising investment did not automatically translate into a proportional increase in formal jobs, highlighting a gap between capital inflows and the availability of secure employment.

“High investment does not necessarily create formal jobs in proportion to the amount invested,” he said.

BKPM data showed that investment in the first half of 2026 was concentrated in base metals and fabricated metal products, mining, transportation, warehousing, telecommunications and property.

Investment in value added processing industries reached Rp 300.1 trillion, accounting for 29.7% of total investment during the period.

Despite the influx of capital, Faisal said the economy had yet to absorb enough workers into formal employment, leaving many dependent on informal work.

“As a result, many people cannot be absorbed into formal jobs and have to work in the informal sector,” he said.

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