Layoff Last Resort to Cope with Impact of Tariff Rise

Semarang, C Java (Antara) - The Semarang branch of the Indonesian textile association (API) said layoff is the last resort to cope with the impact of the government's plan to raise the electricity tariff. "There are a number of ways such as efficiency in energy consumption . We have not yet think of layoff," the API branch chairman Agung Wahono said here on Saturday. Efficiency in energy consumption such as by reducing the use of electric motors and lamps is an alternative, Agung said. "Both Apindo (the association of businessmen) and API agreed that there would be no dismissal of workers . Job cut is used only when companies could no longer sustain the operating cost," he said. Another alternative is by raising the selling prices after negotiations with buyers, he said. "If price hike is the alternative, it would be made gradually to allow the buyer to adjust themselves," he said. Price increase will likely be by 5-7 percent , not yet enough to offset a 10 percent high in production cost as a result of the tariff hike, he said. He said in Central Java there are around 500 textile producers , large and small with large producers making up 30 percent employing 1,000 - 10,000 workers. "The rest are small and medium scale industries with less than 1,000 workers each. There are around 100,000 people having livelihood in textile industry. Therefore, we would seek to avoid layoff," he said. (*)