Jakarta. Indonesia’s textile industry faces potential job cuts as looming US import tariffs raise fears of widespread layoffs in the labor-intensive sector.

US President Donald Trump is set to implement new import tariffs starting August 1, 2025, including a 32 percent tariff on Indonesian products, in addition to an existing 10 percent baseline tariff.

Benny Soetrisno, chairman of the Indonesian Exporters Association (GPEI), said high US tariffs could suppress demand for Indonesian exports, leading to potential job losses in an industry that relies heavily on the American market.

“America has no labor-intensive industries because its labor costs are too high. Finished garments, sports shoes, electronics components, furniture, and crafts from Indonesia could all be hit by the tariffs,” Benny said during Berita Satu’s Investor Market Today program on Wednesday.

Ready-made garments are among Indonesia’s largest export goods to the US, valued at $1.27 billion between January and May 2025, according to Berita Satu Research. Other top exports include sports shoes, palm oil, knitwear, and footwear.

Overall, Indonesia’s exports reached $111.98 billion during the first five months of 2025, with China as the top destination at $24.25 billion, followed by the US at $12.11 billion.

Benny warned that the planned US tariffs pose a serious threat to Indonesia’s labor-intensive sectors. Slower demand from the US due to the higher import duties could force Indonesian producers to scale back operations, triggering layoffs.

“We certainly don’t want to see mass layoffs,” Benny said, adding that he hopes the government will provide support measures similar to those during the COVID-19 pandemic to cushion the impact.

At least 70,000 workers in Indonesia lost their jobs between January and April 2025, according to the Labor Party and a coalition of trade unions, nearly matching the 80,000 increase in unemployment recorded between February 2024 and February 2025. Government data, however, shows 24,000 layoffs as of May 2025.

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