Fiscal and Monetary Policies: Their Impact on the Human Resources Budget

Wilfridus Amleni
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Wilfridus Amleni: University of Timor

Chapter 9 in Macroeconomics for HR Managers: Managing Talent in Market Dynamics, 2026 from PT Literati Global Network

Abstract: This chapter analyzes the influence of government macroeconomic policies, specifically fiscal policy (taxation and government spending) and monetary policy (interest rates and liquidity control), on the strategic decisions of Human Resources (HR) departments and the financial well-being of employees. The discussion begins with an analysis of the mechanism of Income Tax Article 21 (PPh 21) in Indonesia under the Harmonization of Tax Regulations Law (UU HPP). Numerical simulations in this chapter demonstrate how changes in tax rates and the threshold for non-taxable income (PTKP) affect employees' take-home pay. Subsequently, the chapter examines the impact of changes in Bank Indonesia's interest rates on long-term compensation instruments, such as pension funds and severance pay investments, using the theoretical framework of monetary policy transmission through financial markets. This chapter also presents mathematical evidence regarding the influence of interest rate fluctuations on the discount rate for pension and severance liabilities. Finally, the chapter explores the strategic role of HR as a crisis manager in responding to economic shocks, integrating crisis management literature with case studies from the 2008 financial crisis and the COVID-19 pandemic.

JEL-codes: E52 E62 H24 M52 (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:lgn:lgncvl:702809

DOI: 10.66452/702809

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