Even unicorns in Indonesia face talent shortfalls. When Bima Tjahja was appointed associate vice president of data at the Bukalapak e-marketplace in January, he was surprised to discover how difficult it was to find digital talents in Indonesia.
The young man had worked a similar job for four years at Commonwealth Bank in Sydney, Australia, where he could get such talents “quite easily”, before moving to Indonesia earlier this year.
“[Indonesia is] actually in a shortage,” he said during a recent discussion in Jakarta about artificial intelligence (AI) and employment. “It’s very hard to find people who, for instance, have a history in applying machine learning or in handling big data.”
He pointed out that a shortage was particularly concerning as Indonesia’s tech industry was “in need of the most digital talent in its history”.
Demand for such talent, which includes software engineers, analysts and data scientists, is expected to rise as Indonesia’s digital economy is predicted to triple in transaction volume from US$27 billion in 2018 to $100 billion by 2025, according to a Google-Temasek report.
Yet, Communications and Information Minister Rudiantara said the country had a shortfall of 9 million digital talents to meet a targeted 7 percent economic growth by 2030.
Bima said Bukalapak currently employed about 1,100 people, which the company could make do with even though it would benefit from having more.
Thus, Bukalapak, Tokopedia, Grab and Go-Jek, as Southeast Asian unicorns operating in Indonesia, announced over the past five months various investments in local universities to capture more local talent.
Bukalapak opened its AI research center at the Bandung Institute of Technology (ITB) campus in West Java in February. The company provides funding and raw data while the university provides students who are ultimately expected to work for the e-marketplace.
Bukalapak did not disclose the value of its investment in the training center, but the company secured $50 million in a Series D funding round led by Seoul-based Mirae Asset-Naver Asia Growth Fund in January.
Facing a similar shortage, Tokopedia, a rival e-marketplace, opened in March its own AI research center at the computer science faculty of the University of Indonesia (UI) campus in Depok, West Java.
The company did not disclose how much it invested either, but it had secured $1.1 billion in a Series G funding round led by China’s Alibaba Group and Japan’s SoftBank in November last year.
According to Ignatius Untung, chairman of the Indonesian E-commerce Association (idEA), the shortage of local digital talent was so acute that many companies resorted to poaching employees. Thus, the tech industry’s annual turnover rate averages 19.22 percent, almost double the rule-of-thumb limit of 10 percent.
Minister Rudiantara addressed the shortfall by pledging up to $9 million to help more than 20 local universities train 20,000 digital talents by year-end. The universities include, among others, ITB, Gadjah Mada University and UI.
UI also signed a memorandum of understanding this year with ride-hailing rivals Grab Indonesia and Go-Jek.
Grab Indonesia launched in May an Engineering Talent Future Leader internship program, which allows UI students to apply for internships at either Grab’s Jakarta or Singapore offices for between six and nine months.
“The government cannot do everything by itself,” said Grab managing director Neneng Goenadi. “We are even thinking about creating a [longer] internship program for Indonesians, whether fresh graduates or workers who are eager to learn. We’re thinking the program will be about one or two years.”
She said that Grab also provided some raw data for partner universities to practice with and, hopefully, create usable solutions. The cost of the collaboration is part of Grab’s three-year $700 million investment to expand the country’s digital economy.
Meanwhile, rival Go-Jek signed its memorandum with UI in April. The company, which prides itself as a homegrown unicorn, pledges exclusive internships, joint studies and priority recruitment for UI students.
Go-Jek chief of corporate affairs Nila Marita described the collaboration as “a special opportunity for us to develop local talents who can compete on a global level”.
Bukalapak’s Bima told The Jakarta Post after the discussion that, looking forward, he expected even more tech companies to partner with local universities, particularly ITB and UI, in capturing digital talents.
“Most of [Bukalapak’s] talents are from UI and ITB. They’re producing good people. We just need more of them,” he said. Even unicorns in Indonesia face talent shortfalls (Norman Harsono, The Jakarta Post)