7 Lessons 2025 Taught Us about Hiring Indonesia Tech Talent (and How to Plan 2026)

Indonesia’s tech hiring in 2025 proved how real the talent war, salary shifts, and compliance risks have become. These 7 lessons show what global teams must change in 2026 to hire Indonesian tech talent faster, safer, and more realistically.

In 2025, Indonesia's tech market didn't just grow, it accelerated, with hundreds of thousands of new digital roles opening and demand outpacing supply in almost every major skill set.

As companies move to 2026, the winners will be those that actually change how they hire Indonesian tech talent instead of repeating the same slow, reactive processes and hoping for different results.

1. The Talent War is No Longer Just a Slogan

By 2025, many companies finally felt what "talent war" really means: critical roles sitting open for months while product roadmaps and delivery deadlines keep moving.

Teams that relied on passive job boards and five-round interview processes consistently lost candidates to employers with better pipelines and faster decisions.

Market reports show a surge in demand for software engineers, AI, data, and cybersecurity roles, while the talent pipeline has no kept pace. Strong candidates now juggle multiple offers at once, so employer brand, candidate experience, and clarity of process are not "nice to have" anymore, they are the deciding factors.

2. Long Time-to-Hire Quietly Drains Revenue

A second big lesson from 2025: a 60-90 day hiring cycle is not just "a bit slow", it quietly delays features, stalls releases, and leaks revenue over time. Many hiring managers realised that the real bottleneck was not "too few CVs" but slow internal alignment, too many interview rounds, and drawn-out approval processes for offers.

Companies that cut unnecessary steps, standardised evaluation, and set clear decision timelines often reduced hiring lead times significantly. In Indonesia's competitive market, a simple rule holds: if you cannot make a decision within a few days of the final interview, someone else probably will.

3. Compensation Expectations Have Moved

In 2025, foreign employers frequently arrived in Indonesia assuming they could pay significantly below their home markets and still secure top-tier engineers, only to be surprised by mid-senior candidates asking for much higher packages.

Local salary guides and talent reports show upward pressure on pay for specialised tech roles, reinforced by regional and remote opportunities.

Companies that stuck stubbornly to low ranges often attracted under-levelled candidates or had to refill roles within 6-12 months. Those that combined local benchmarks with a realistic view of the skills they needed, plus relevant benefits like BPJS, insurance, and remote allowances, were able to hire more stable, engaged talent.

4. Skills-Based Hiring is Beating CV-Driven Hiring

A clear shift in 2025 was the move from degree-centric hiring to skills-based hiring for tech roles in Indonesia. Employers increasingly testes real capabilities through take-home tasks, live coding, case studies, and portfolio reviews rather than over-indexing on university names or brand-name employers on a CV.

This trend fits wider national efforts to close the digital skills gap through upskilling in AI, cloud, cybersecurity, and data. For hiring teams, the implication is straightforward: job descriptions and interviews need to be built around the skills that truly matter for day-to-day work, not generic requirements that filter out good candidates for the wrong reasons.

5. The 2030 Talent Crunch is already visible

Multiple reports and government statements point to a need for around 9-12 million digital talents in Indonesia by 2030, with a structural shortfall of several million if current training output does not accelerate.

The impact is already visible: strong candidates are "super in demand", counter-offers are common, and employers that only think in 3-month cycles end up constantly firefighting.

Global companies using Indonesia as a product or engineering hub now have to think in multi-year horizons: combining senior hires with graduate intakes, partnerships with universities and bootcamps, and remote working models that let them tap into talent in more cities than just Jakarta.

2025 made it clear that those who treat Indonesia purely as a cheap, endless talent pool will be disappointed.

6. Compliance and Structure Can't Be an Afterthought

Another painful lesson in 2025 was that hiring Indonesian staff or long-term contractors without the right legal structure can create tax, BPJS, and employment risks that are expensive to unwind.

Many companies only started asking about Employer of Record (EOR), payroll partners, or local entities after they had already run into issues.

For many international employers, EOR proved to be a practical bridge: it allowed them to employ Indonesian tech talent compliantly while they tested the market, without immediately setting up a full local entity.

Organizations that made these structural decisions early typically enjoyed smoother onboarding, clearer contracts, and fewer "surprise costs" later.

7. Remote Work and Engagement Need Real Structure

By 2025, plenty of companies had successfully hired remote Indonesian engineers, but not all had figured out how to keep them engaged and productive over time.

Without clear norms around communication, documentation, working hours across time zones, and decision-making, remote teams quickly drift into misalignment and disengagement.

Experiences from remote-first organizations show that regular check-ins, well-designed workflows, and visible learning paths are key to keeping distributed Indonesian tech teams motivated.

Companies that treat remote work as a deliberate operating model, not just a perk, are already seeing better retention and output from their Indonesia-based engineers.

How to Plan Your Indonesia Tech Hiring in 2026

Moving into 2026, the question is how to turn those lessons into a concrete plan. Below are four practical moves that founders, HR, and hiring managers can align on when hiring Indonesian tech talent.

1. Build an Honest Talent Map First

Before publishing any job ads, map out what you actually need: which roles are truly critical, at what seniority, and by when. Separate "must-fill to hit revenue and delivery targets" from "nice-to-have" roles so you can allocate focus and budget more realistically.

This kind of talent map makes internal conversations far more grounded: "two backend engineers in Q1, one data engineer in Q2, one EM in H2", and let's you check whether your expectations match market reality and budget. Local partners who live in the Indonesian market every day can add real-world data rather than guesses.

2. Redesign Your Process around Speed and Clarity

Audit your current hiring steps and remove anything that does not clearly improve the decision. For many teams, that means fewer interview rounds, clearer scorecards, and a hard deadline for decisions a few days after the final interview.

In a market where top candidates can receive multiple offers within days, your ability to respond quickly, and explain your process up front, often weighs as much as the salary number itself.

Speed plus transparency is often what convinces Indonesian tech talent to choose one employer over another.

3. Align Compensation and Value Proposition with the Market

Use current Indonesia, specific salary and benefits data as your anchor rather than assumptions from HQ. Then decide where you want to position your company: closer to market median with strong learning and ownership, or closer to the upper range for particularly scarce skills.

At the same time, refine your value proposition for Indonesian tech talent: what will they actually get in terms of growth, autonomy, stability, and impact.

Experienced candidates are quick to sense hype, but they respond positively to clear, concrete stories about how teams are built and decisions are made.

4. Choose the Right Legal Structure from Day One

Instead of "fixing" compliance later, decide early whether you will use an EOR, a payroll and HR partner, or your own entity to employ Indonesian talent.

Each path has trade-offs across speed, cost, control, and risk, and the right answer often depends on your stage and how fast you plan to scale.

For many companies in the first 12-24 months, an EOR model is a pragmatic way to move fast and stay compliant while you test and grow your Indonesian team.

As your headcount and revenue exposure increase, you can then reassess whether a local entity or a hybrid structure makes more sense long term.

If your company wants to turn these seven lessons from 2025 into a faster, safer, and more realistic Indonesia tech hiring strategy in 2026, contact RainTech today to discuss the approach that best fits your stage and goals.

Resource: https://raintechnovation.com/resources/7-lessons-2025-hiring-indonesia-tech-talent