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Pay gap may pay off for Jakarta

By Bloomberg | China Daily | Updated: 2015-04-07 08:34

Factory workers in the United States will be paid 58 times those in Indonesia in five years, according to the Economist Intelligence Unit. If that seems like a big difference, consider this: US wages are 76 times Indonesia's today.

Hourly manufacturing wages in the US will rise 12 percent to $42.82 by 2019, according to the EIU. While Indonesia's wages are forecast to increase at a much faster pace - gaining 48 percent - they would still only be 74 cents an hour in five years. That's way lower than China's $4.79, Vietnam's $3.16 and the Philippines' $3.15.

Indonesia is trying to establish its manufacturing credentials in an increasingly competitive neighborhood, with countries including Vietnam and the Philippines also fighting to woo investors looking for alternatives to a pricier China.

Pay gap may pay off for Jakarta

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