This paper analyses the employment impact of a significant shift to more restrictive labour market regulations in Indonesia in the early 2000s. The study compares plants in labour-intensive and non-labour-intensive manufacturing industries over time, and use difference-in-difference methods to analyse different employment trends between these two groups around the time of the labour regulation shift. It finds that employment in labour-intensive plants decline relative to non-labour-intensive plants around the time of the labour regulation change. This pattern is robust to using different measures of labour intensity, and to controlling for other policies that can affect different industries differently during the same period.