Employment Status Inequality in Inclusive Human Resource Management Based on Islamic Work Ethics in Indonesia

Abstract

This study aims to analyze employment status inequality between formal and informal workers in Indonesia and to explain how Islamic Work Ethics can strengthen a justice-oriented inclusive Human Resource Management framework. This issue is important because informal workers remain a dominant segment of Indonesia’s labor market, yet they often face limited access to adequate income, social protection, job security, competency development, and labor participation. This study employs a qualitative-dominant mixed-method design based on secondary data. The data were obtained from labor statistics, official reports, policy documents, regulations, and academic literature related to employment inequality, informal workers, inclusive Human Resource Management, and Islamic Work Ethics. The analysis was conducted through descriptive-comparative analysis, gap analysis, document analysis, and integrative analysis based on Islamic ethical values. The indicators examined include the composition of formal and informal employment, income, social protection, job quality, and access to development and participation. The findings indicate that employment status inequality in Indonesia is structural and multidimensional. This inequality is reflected in the dominance of informal workers, the lower average income of informal workers compared with formal workers, limited access to social protection, and the insufficient integration of informal workers into inclusive Human Resource Management practices. This study contributes conceptually by linking employment status inequality, inclusive Human Resource Management, and Islamic Work Ethics within a single analytical framework. The findings highlight the need to shift Human Resource Management from a formal organization-based approach to a broader labor ecosystem-based approach. Islamic Work Ethics strengthens this framework through the principles of justice, trustworthiness, excellence, public benefit, human dignity, and fair wages as normative foundations for reducing inequality between formal and informal workers in Indonesia.