A regulation introduced early last year tightening recruitment of foreign workers, coupled with more restrictions planned for next year, will further reduce the number of expatriate workers in the country.
Since the government closed off 19 types of jobs to expatriates last year, their numbers have declined by 6 per cent, or 4,880, to 72,427 compared to 2011, according to data from the Manpower and Transmigration Ministry.
Technical jobs contributed to the steepest decline, followed by managerial and professional jobs.
The decline was in contrast to the record rise in realised foreign investment (FDI) last year, which reached the unprecedented level of Rp 221 trillion (S$27.9 billion), or 26 per cent higher than in 2011.
"Soaring FDI no longer means a higher intake of expatriates," said the ministry's director general of labour placement and advisory, Reyna Usman, recently.
"Since last year, we have introduced a restriction in the recruitment of foreign workers. That explains the decline," she said.
The restriction was aimed at providing more opportunities to develop local human resources, especially in mid-level positions.
Indonesia's rapidly growing economy has increased business profitability in recent years, prompting demonstrations by workers demanding better positions and higher salaries.