From Water Buffaloes to Motorcycles: The Development of Large-scale Industrial Estates and Their Socio-spatial Impact on the Surrounding Villages in Karawang Regency, West Java

Abstract

This paper examines the impact of industrial estates on surrounding villages in Karawang Regency, West Java, Indonesia. A few large industrial estates have been in operation since the latter part of the 1990s, with hundreds of tenants, mainly auto manufacturers and related component suppliers. The rapid inflow of industry and decrease of agriculture-related jobs have prompted villagers to look for jobs in the industrial estates. However, there is a significant mismatch between the average educational and skill levels of the villagers and those required by companies in the estates. Competition with a growing number of immigrants with higher educational or skill levels has made it difficult for local villagers to obtain jobs in industry, while newcomers with a more secure job status are forming a new socioeconomic order outside the existing village settlements. The study also found that recruitment of regular staff had decreased rapidly since the introduction of a new labor law in 2003. Widespread use of fixed-term contracts and temporary agency workers has made jobs in industrial estates fragile and short-term. This gives companies flexibility of employment but at the same time is producing a growing pool of disenchanted and frustrated village youths in the surrounding environment. Further assistance to the villagers is desirable—not only for their sake but also for local government and industry if they hope for a long-term peaceful and conducive business environment.