East Java governor clarifies viral claims as company faces sharp profit decline
Viral videos of worker farewells at Gudang Garam’s Tuban factory sparked speculation of mass layoffs. East Java Governor Khofifah Indar Parawansa has denied the rumors, stating the company is only carrying out a long-running early retirement program involving a limited number of employees.
Governor and Officials Deny Layoff Rumors
On 8 September 2025, Governor Khofifah Indar Parawansa confirmed there were no mass layoffs at PT Gudang Garam Tbk, countering claims circulating on Instagram and X. She clarified that only 200 employees had opted into an existing early retirement program, a process ongoing for some time.
Confirmation from Management
HRD representative Adib Musyafa from PT Merdeka Nusantara Mitra Produksi Gudang Garam Tuban echoed the governor’s statement, stressing that the Tuban plant continues to operate with 800–850 employees. “There is no dismissal of workers here,” he said, dismissing speculation of thousands affected.
Viral Video Sparked Speculation
The rumors emerged after a video of farewell gatherings at the Tuban facility went viral, prompting assumptions that financial struggles had forced widespread job cuts. The issue gained traction amid reports of Gudang Garam’s steep profit decline in the first half of 2025.
Financial Pressures
According to company filings, Gudang Garam’s net profit plunged 87.3% year-on-year, falling to Rp117.16 billion from Rp925.5 billion. Revenue also dropped 11.4% to Rp44.35 trillion, while gross profit contracted to Rp3.7 trillion from Rp5.06 trillion in the same period of 2024.
Gradual Workforce Decline
Despite assurances of normal operations, annual reports show a gradual reduction in employees from 32,491 in 2019 to 30,308 in 2024. Analysts link this trend to rising tobacco excise taxes and competition from illegal cigarettes, forcing restructuring across the industry.
Official Perspective
East Java’s manpower office confirmed that early retirement offers were voluntary and fulfilled for 200 staff. Governor Khofifah stressed that the company’s workforce remains stable, and operations at the Tuban plant are unaffected by the financial downturn.
The controversy over alleged mass layoffs at Gudang Garam illustrates how viral content can quickly fuel misinformation during times of corporate stress. While the company struggles with declining profits, both management and government officials reaffirm that only early retirement measures are underway, not large-scale job cuts.
Sources: ANTARA News (2025) , Kompas.com (2025)
Keywords: Gudang Garam, Mass Layoffs Rumor, Early Retirement Program, Khofifah Indar Parawansa, Tobacco Company Losses, Tuban Factory
