Migration, Remittance And Female Migrant Workers
Fact Sheet
MIGRATION, REMITTANCE AND FEMALE MIGRANT WORKERS
How many Indonesian migrant workers are there?
• Approximately 400,000 Indonesians are registered to have legally migrated to other countries each
year since 1998. The actual figure is estimated to be much higher because many migrate illegally.
• In 2004, the number of registered Indonesian migrant workers was 380,688 persons. Of this
number, 83% are women. More than 90% of female migrant workers work in the informal sector as
housemaids. The rest works in the agricultural and industrial sectors as daily labours, as caregivers
to the elderly, shop assistants, and as waitresses.
What is the trend of migrant flows from Indonesia?
• The number of migrant workers tends to increase each year. A drastic increase occurred in 1997-
1998 concomitant with the economic crisis occurring in Indonesia.
• A significant drop occurred in 2001 and in 2003 due to a temporary bar on placements in the
Middle East and in Taiwan, stricter requirements for dispatching migrant workers, the spread of the
SARS epidemic in a number of destination countries in the Asia and Pacific region, and the
outbreak of war in the Middle East.
Trend of Indonesian Migration
6 0 0 0 0 0
5 0 0 0 0 0
4 0 0 0 0 0
3 0 0 0 0 0
Male
2 0 0 0 0 0
F e m a l e
1 0 0 0 0 0
0
1 9 9 4 -
1 9 9 8
2 0 0 0
2 0 0 2
2 0 0 4
1 9 9 7
• During the 1980s, the migration of female workers, particularly the domestic sector, started to
occur in significant numbers as a consequence of a new Government policy starting to promote
labour exports.
• The percentage of female migrant workers continued to increase, so that by 1992 their number
was 89% of the 95.908 registered Indonesian migrant workers. By 2001, their percentage reached
91.5% of the total. In 2004, although the percentage of female migrant workers of Indonesian
migrant workers dropped to 82.8%, their absolute number is still much higher compared to the
number of male migrant workers.
Why do they migrate?
• Because the income in their villages is uncertain and is not enough to meet their daily living
expenses.
• Because the number of jobs offered overseas is much higher as well as more varied and more
promising.
Female Migrant Workers Research Team
January 2006 – 1
• Following in the footsteps of family or friends who have already migrated earlier.
• Influence by agents whose role is significant in recruitment process
• To gain a higher social status.
Who are the Indonesian female migrant workers?
• The majority are from selected regions, such as West Java (Sukabumi, Cianjur, Indramayu);
Central Java (Cilacap, Wonosobo); Yogya (Kulon Progo); East Java (Malang, Kediri, Ponorogo);
East Nusa Tenggara, West Nusa Tenggara, South Sulawesi, Lampung.
• The majority are unskilled workers with a low education level, generally only up to primary school.
• The official documents generally record their age as between 18-40 years, but in fact their age
ranges between 14-40 years.
• The majority are married and, some are divorced.
Where do Indonesian female migrant workers migrate to?
• By the end of the 1970s, during the oil boom in the Middle East, the major destination country was
Saudi Arabia, and there was a high demand for women in the domestic sector. Around 1990, the
destination countries for female migrant workers expanded to South East Asia and the Asia Pacific
region as a consequence of the opening of job opportunities by Governments in the host countries.
• Currently, the major destination countries for female migrant workers are: Saudi Arabia, Malaysia,
Kuwait, Singapore, Hong Kong and Taiwan, while the destination countries for most of the male
migrant workers are still Malaysia and Saudi Arabia.
Top Destination Countries for Female Migrants
250,000
200,000
Hong Kong
150,000
Malaysia
100,000
Singapore
Taipei-China
50,000
Kuwait
Number of Migrants
0
Saudi Arabia
1997 1998 1999 2000 2001 2002 2003 2004
Uni Arab Emirates
Year
Top Destination Countries for Male Migrants
120,000
100,000
Malaysia
Singapore
80,000
South Korea
60,000
Taipei-China
40,000
Kuwait
20,000
Number of Migrants
Saudi Arabia
0
1997 1998 1999 2000 2001 2002 2003 2004
Year
Female Migrant Workers Research Team
January 2006 – 2
• In Malaysia, the number of female migrant workers is less than the number of male migrant
workers, while in Saudi Arabia it is the reverse. In 2004, the number of female migrant workers in
Malaysia was 49%, and in Saudi Arabia 94% of the total registered Indonesian migrant workers.
• Malaysia is the favourite choice as destination country for illegal migrant workers.
• The government of Taiwan barred migrant workers in 2003 because of the high levies charge by
local agents who are business partners of PJTKIs, high numbers of female migrant workers
running away from their employers, and high numbers of cases of data falsifications in documents
belonging to Indonesian migrants. In was re open in April 2005. The destination countries in the
Middle East were closed by the Government of Indonesia in March 2004 for 3 months in
anticipation of the Gulf War, and from March till June 2005 to improve the placement system.
What are the costs of migrating for female migrant workers?
• Placement fees are officially stipulated by the Department of Manpower and Transmigration, but in
reality the amount that migrants paid is much higher.
Country of
Placement fee
Fee paid by
Method of payment
Destination
(Depnakertrans) female migrant
workers
Hong Kong
Rp 18,000,000
Rp 21,000,000
81% deducted from monthly wages
during 7 months
Taiwan
Rp 24,000,000
Rp 36,000,000
67% deducted from monthly wages
during 14 months.
Saudi Arabia
Rp 500,000
Rp 600,000-Rp Cash. In cases where they borrow
and other
3,500,000
money from sponsor or local money-
Middle Eastern
lenders, payment may be 3 times
countries
higher than the loan.
Malaysia
Rp 500,000
Rp 800,000
100% deducted from the monthly
wages for 1 month
• The money to pay placement fee is obtained by borrowing from relatives, friends, money-lenders or
the mediator who manages their departure process, or is deducted from wages upon employment.
What are the wages of Indonesian female migrant workers?
• Workers in the informal sector (such as domestic help, or caregiver of the elderly etceteras) are
engaged on a contract for a work period of 2 years, after which they must go back to Indonesia. In
the case of Taiwan, the contract can be extended by 1 year without having to return to Indonesia.
• Hong Kong is the only destination country that has a minimum wage regulation for migrant
workers.
• Each destination country has a different wage standard. The highest wage is in Hong Kong and
Taiwan, the lowest is in Malaysia.
Destination Country
Monthly wages
Wages in Rupiah
(exchange rate 2003)
Saudi Arabia
± SR 600
± 1,342,200
Jordan
± US$ 150
± 1,269,900
Kuwait
± KD 40
± 1,132,178
Female Migrant Workers Research Team
January 2006 – 3
Destination Country
Monthly wages
Wages in Rupiah
(exchange rate 2003)
Abu Dhabi
± D 900
± 2,074,717
Qatar
± QR 550
± 1,279,203
Malaysia
± RM 350
± 761,600
Singapore
± Sin$ 250
± 1,239,750
Hong Kong
± HK$ 3,670
± 3,930,570
Taiwan
± NT 15.000
± 3.735.000
• In reality, the wages received are lower compared to the contract value. This is because generally
many employers pay monthly wages below the value that was stipulated in the contract, as well as
because of various deductions to repay the placement fee.
Amount of money earned within 2 years of working
(1st period of contract)
120,000,000
100,000,000
Hong Kong
80,000,000
Taiwan
60,000,000
Saudi Arabia
40,000,000
Singapore
20,000,000
Malaysia
0
Contract
Received
• Based on the currency of the destination countries in nominal value, migrants do not receive
increase in their wages over the years. When converted into the rupiah constant value, their wages
shows a trend to decrease.
Female Migrant Wages
Female migrant wages
(in nominal value of destination country)
(in rupiah constant value)
600
4,700,000
500
4,200,000
3,700,000
400
3,200,000
300
2,700,000
2,200,000
200
1,700,000
100
1,200,000
Wage (in rupiah constant vaklue)
700,000
0
200,000
1997
1998
1999
2000
2001
2002
2003
1997
1998
1999
2000
2001
2002
2003
year
year
Arab Saudi
Arab Saudi (Riyals)
Brunei (Ringgit Brunei)
Brunei
Hong Kong (Puluh-Dolar Hong Kong)
Hong Kong
Malaysia-PRT (Ringgit Malaysia)
Malaysia-PRT
Malaysia-perkebunan (Ringgit Malaysia)
Malaysia-perkebunan
Malaysia-kilang (Ringgit Malaysia)
Malaysia-kilang
Taiwan (Ratus-Taiwan Dolar)
Taiwan
Female Migrant Workers Research Team
January 2006 – 4
How do female migrant workers save money in the destination country?
• By the employer, and they will ask for it to be sent to their family or when they are returning to
Indonesia
• By themselves, in a clothes closet or under the mattress, until they are ready to send it to their
family
• In a savings account in their own name, which they close once they return home
• In the form of gold (usually if they work in Saudi Arabia or Malaysia)
How do female migrant workers remit their money?
• Formally they remit it through banks or the post office, whether personally or by asking the help of
their employer or a friend.
• Informally they remit it through an Indonesian shop (specifically in Hong Kong), a middle person
who specialises in the service of remitting money, through a friend or relative who is returning to
the village.
• Cost of sending remittances varies, depending on the country where they are sending the money
from and the way they choose to send it. For example, the cost of sending remittances through a
formal channel (2003 rates) is: Malaysia Rp 25.000, Saudi Arabia Rp 12.500-20.000, Brunai Rp
100.000, Taiwan Rp 62.500-75.000 and Hong Kong Rp 20.000-35.000.To send informally, the cost
is Rp. 5,000-12,000 in Malaysia, and Rp. 20,000-40,000 in Hong Kong.
• Frequency of remitting is quite irregular, depending on the request of the family in the local village.
Nevertheless, during 1 contract period most migrants remit 2-4 times. During the first months of the
contract it is difficult for them to send money home. Since the bulk of their money goes for various
deductions. Migrants in Hong Kong tent to remit money more regularly than migrants in other
destination countries, and those in Malaysia face the most constraints in remitting money.
• The amount of money sent varies each time. Generally, they send Rp. 1 to 5 million at a time, if it
is through a bank. This is because there are migrants who send money every 2-3 months, but
there are also migrants who save first for 1-2 years. If the money is sent through a friend, then it
would be between Rp. 250,000 to Rp. 2 million.
• Recipient of remittances is usually the husband or the father of the female migrant worker.
What is the value of remittances to Indonesia?
• The recorded remittances received by Indonesia were approximately US$ 1.2 billion per year from
1998 till 1999, and nearly reached US$ 2 billion in 2001. In 2002 the amount of remittances
reached US$ 2.1 billion, in 2003 US$ 1.49 billion and decreased again in 2004 to US$ 1 billion in
line with the decrease of the numbers of Indonesians leaving to work overseas. For 2005, it is
estimated that the total remittances reached US$ 2.5 billion. In reality, the total remittance are
much higher since not all in-flow are well recorded.
• The value of remittances at the national level is quite significant compared to the foreign exchange
obtained from the non-oil and gas sector and agricultural exports.
Female Migrant Workers Research Team
January 2006 – 5
Remittances and other foreign Exchange source in
6,000
2001
5,000
Remittances
4,000
US$ million 3,000
Agriculture export
2,000
Non oil & gas mining
1,000
export
0
2001
How does the value of Indonesian remittances compare to other migrant sending
countries?
• Nominally the value of Indonesian remittances is relative lower compared to other sending
countries.
Remittance in Nominal Value
25
20
India
15
US$ billion
Bangladesh
10
Philippines
Indonesia
5
0
2001
2004
• Indonesian remittances as a percentage of GDP is also relatively lower compared to other sending
countries.
Remittance in % GDP
10
India
8
Bangladesh
6
% of GDP
Philippines
4
Indonesia
2
0
2001
Why are the Indonesian remittances relatively low?
• Many of the remittances that enter Indonesia are not detected because of inadequate recording
system:
-
The formal data is inadequate because remittance does not have its own category, and
remittance is frequently calculated by estimating from “ all residual of balance of payment”
(BOP)
-
The formal data from BOP frequently only calculate the amount of wire transfer of remittance,
and not the in-flow of remittance.
Female Migrant Workers Research Team
January 2006 – 6
-
The formal data frequently does not record remittances that are sent by temporary migrants
(who are not permanent residents in the host country). Temporary migrants do not sent home
all of their money, but bring parts of it in cash when coming home. Therefore, formal data only
calculate net in-flow and not gross in-flow.
-
Non-monetary goods and other valuable goods (gold from Saudi Arabia for example) are not
yet included in calculating remittances.
• The wages received are relatively low because the majority of Indonesian migrant workers,
particularly female migrant workers, are working in the informal sector. Since they are in a
vulnerable position, they is no guarantee that they will receive their already meagre wages in full.
Female migrant workers often do not receive the wages they are untitled to and even have to stop
working before the contract period expired due to various problems, such as being cheated or
being exposed to violent and harassment.
• There are a considerable number of illegal migrants coming home without being paid even though
They have worked for months, sometimes even for more than a year.
Number of Formal & Informal Migrant Workers by Sex in 2001
350000
300000
250000
200000
150000
100000
Female
50000
Male
0
Formal
Informal
• The high costs of placement and several types of additional costs payable by migrant workers
makes it impossible for them to save and remit money in large sums.
• The difficulty to access banking services for illegal migrant workers in Malaysia made them prefer
remitting their money through informal channels.
What is the role of remittances at local level?
• Remittances sent by migrant workers constitutes significant revenues for the villages where
migrants originated from.
• At the sub-national level, district and provinces receive significant amount of remittances. For
example, following is a comparison of regional own source of revenues (PAD) and remittances (in
billion rupiah) at provincial and district level.
Female Migrant Workers Research Team
January 2006 – 7
Amount of Remittance and PAD in Provinces
Amount of Remittance and PAD in Sukabumi District
3 5 0 0
600
3 0 0 0
PAD of East
500
Java
2 5 0 0
PAD
Remittance of
400
2 0 0 0
East Java
PAD Jawa
300
1 5 0 0
PAD of NTB
200
1 0 0 0
Remittance of
100
Remittance
5 0 0
NTB
0
0
2001
2002
2003
2 0 0 1
2 0 0 2
2 0 0 4
• At the community level, remittances help stimulate local economy activities, in particularly those
that are responding to needs of migrant workers and their families, such as telephone kiosk,
motorcycle taxi, credit for motorcycle , building material shops.
How are the remittances utilised by the migrant worker and their families?
• The quality and quantity of remittance utilisation is quite varied among the several migrant workers,
depending on the value of the remittances saved, sent and brought back personally.
• The major priority in the utilisation of remittances is to pay off debts, to meet the daily living needs,
and to build a house including buying furniture. If there is any money left after spending on the
above, it will be used to buy gold, buy motor cycle, buy land, buy or lease rice fields, buy livestock
and pay for the children’s education. Very few succeed in investing remittances in a business
venture and managing it in a sustainable manner.
• Remittances are not utilised to access better health and education services, because the above
two matters are not the priority of migrant families.
• If the remittance becomes the major or the sole source of income for the migrant worker’s family, it
tends to be exhausted to meet daily living expenses. If the migrant workers have a sufficiently
stable economic background, the remittance can be saved to enhance the family’s assets.
• Remittances that are used to meet various living necessities without any other source of income
will usually be exhausted within 2-7 months. After that they have to resell the assets that they have
and go back to the original condition or again work overseas.
Sources of data and informations:
• Antisipasi Perang Teluk, Penempatan TKI ke Timur Tengah Dihentikan, Kompas, 22 January 2003
• Depnakertrans Buka Kembali Penempatan TKI Ke Timur Tengah, Media Indonesia Online, 26 Maret 2005
• Depnakertrans PRediksi Pengiriman Uang TKI US$ 2 Milyar, Media Indonesia Online, 11 November 2005
• Impacts of Migration and Usage of Remittances: Seeking Ways towards Improving Female Migrant Workers’ Welfare , Draft
Report, World Bank Office Jakarta, 2005
• Interview with female migrant workers and their families in Sukabumi, Malang, Bone and Lombok Tengah districts, 2004-
2005
• Global Economic Prospect 2006: Economic Implications of Remittances and Migration, World Bank 2005
• Ministry of Manpower and Transmigration Data
• Sukabumi Regency Data, 2004
Female Migrant Workers Research Team
January 2006 – 8
• Sukabumi District BP2TKI Data, 2004
• NTB Province Statistical Data , 2004
• NTB Province BP2TKI Data, 2004
• Vulnerability of Indonesian Female Migrant Workers, World Bank Office Jakarta, 2003
• www.answers.com/topic/table-of-historical-exchange-rates
• www.migrationinformation.org
• www.nakertrans.go.id
• www.state.gov/documents/organization/8166.pdf
Female Migrant Workers Research Team
January 2006 – 9
