THE FUTURE OF LEGAL POLICY IN INDONESIA: ADDRESSING LABOUR MARKET SHOCKS IN THE AGE OF ARTIFICIAL INTELLIGENCE
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Abstract
The rise of Artificial Intelligence (AI) is fundamentally reshaping labour markets globally, creating a complex dual challenge for Indonesia. While AI promises valuable gains in productivity and innovation, it simultaneously fuels significant concerns regarding job displacement and unemployment. This article critically examines AI's impact on Indonesia's employment situation through a legal theory lens, employing doctrinal research to assess how the country's labour rights and regulatory frameworks—evaluated against principles of protection, fairness, and social justice—respond to this technological disruption. The study confirms that AI both destroys existing jobs and catalyses new forms of employment, mandating a legal framework that skilfully balances innovation with essential worker protection. However, current regulations exhibit clear gaps in establishing employer responsibility, defining retraining obligations, and securing adequate social security for displaced workers. Consequently, the research argues compellingly for a progressive legal reform that incorporates responsible innovation, anticipatory regulation, and inclusive labour protection, supported by adaptive standards and robust reskilling programs, to ensure AI development genuinely aligns with sustainable employment and social welfare across Indonesia.
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