The Role of Industrial Relations
Introduction
The Asian financial crisis in the middle of 1997, which is started in Thailand, spread to others countries in Southeast Asia Region. According to Investopedia, financial crisis is certain circumstances which the value of financial institutions and assets drop rapidly. So, the investors will sell off assets or withdraw money from saving account. The financial crisis can cause the economy in to recession or downturn.1 This financial crisis immediately has impacts to the financial market that includes exchange rate instability, capital outflows, and declining productivity. That condition led to loss of profitability and large number of unemployment. International Labor Organization (ILO) has defined and identified the probabilities of the main factors regarding to Asian financial crisis in 1997, especially in Indonesia. The incompatibility between exchange rates and capital account because of macroeconomic mismanagement could be the first reason of causing crisis.2 On the other hands, the collusion between the government, banks, and the corporate sector is leading to trigger the crisis. Because of the misconception of industrial relation theories, where there is a good companion between the government and workers, the imperfection in financial markets will distract the productivity of capital and labor.
A. Industrial Relations System in Indonesia Indonesia has experienced rapid economic growth and rising per capita income from the mid-1980s to the mid-1990 that improved its welfare in health, education, and job opportunities. Since the Asian financial crisis in the middle of 1990s, its dramatically increase the unemployment rate and a decline in wages for those who did not lose their jobs, with women being particularly vulnerable because the criminality as getting higher.
This condition also accompanied by the increasing price of drugs and health service, and rising food prices that cause malnutrition. In education sector, declining income also
The Asian financial crisis in the middle of 1997, which is started in Thailand, spread to others countries in Southeast Asia Region. According to Investopedia, financial crisis is certain circumstances which the value of financial institutions and assets drop rapidly. So, the investors will sell off assets or withdraw money from saving account. The financial crisis can cause the economy in to recession or downturn.1 This financial crisis immediately has impacts to the financial market that includes exchange rate instability, capital outflows, and declining productivity. That condition led to loss of profitability and large number of unemployment. International Labor Organization (ILO) has defined and identified the probabilities of the main factors regarding to Asian financial crisis in 1997, especially in Indonesia. The incompatibility between exchange rates and capital account because of macroeconomic mismanagement could be the first reason of causing crisis.2 On the other hands, the collusion between the government, banks, and the corporate sector is leading to trigger the crisis. Because of the misconception of industrial relation theories, where there is a good companion between the government and workers, the imperfection in financial markets will distract the productivity of capital and labor.
A. Industrial Relations System in Indonesia Indonesia has experienced rapid economic growth and rising per capita income from the mid-1980s to the mid-1990 that improved its welfare in health, education, and job opportunities. Since the Asian financial crisis in the middle of 1990s, its dramatically increase the unemployment rate and a decline in wages for those who did not lose their jobs, with women being particularly vulnerable because the criminality as getting higher.
This condition also accompanied by the increasing price of drugs and health service, and rising food prices that cause malnutrition. In education sector, declining income also