Jakarta, Indonesia Sentinel — The Central Statistics Agency (BPS) reports Indonesian middle class population decline keeps on progressing and currently constitutes 17.13% of the population, equivalent to 46.85 million people categorized as middle class. This marks a decline from 2019, when 21.45% of the population or 57.33 million people were categorized as middle class. In 2021, the proportion fell again to 19.82%, or 53.83 million people.
Senior Economist at the Institute for Development of Economics and Finance (Indef), Tauhid Ahmad, notes that many in the middle class are now sliding towards vulnerability and poverty.
“Some have fallen one level, while others have dropped two levels. The levels range from poverty at the bottom, to near-poor in the middle, and those approaching middle-class status,” Tauhid explained, stated from detikcom on Saturday, October 5.
According to BPS data, as the middle class population decreases, the numbers of those near-middle class and vulnerable to poverty are rising. In 2019, the vulnerable population was recorded at 54.97 million, or 20.56% of the population. This figure rose to 21.47% in 2021 (58.32 million people) and to 24.23% in 2024 (67.69 million people).
Similarly, the near-middle class increased from 48.20% of the population in 2019 (128.85 million people) to 48.17% in 2021 (130.8 million people), and further to 49.22% in 2024 (137.5 million people).
Bhima Yudhistira Adhinegara, Executive Director of the Center of Economic and Law Studies (Celios), explains that the largest share of middle-class spending is on food, which now accounts for 41.67% of their expenses. Housing is the second-largest expense at 28.5%, while only 0.38% is allocated for entertainment.
The monthly expenditure of the middle class ranges from Rp1.9 million to Rp 9.3 million per person. Meanwhile, the lower middle class spends between Rp 825,000 and Rp 1.9 million, and the vulnerable class between Rp 550,000 and Rp 825,000 per person.
‘Desperate’ Trend on LinkedIn Emerged Amid Gen Z Job Seekers Growing Frustration
According to data from the Central Statistics Agency (BPS), spending on food has risen significantly over the past decade. Among the middle class, food accounts for 41.67% of their expenditures this year.
In contrast, spending on entertainment has dropped to 28.52% in 2024, down from 34.36% in 2014. Similarly, transportation costs have declined from 7.27% in 2014 to 3.99% in 2024.
When compared to upper-class spending, the proportion spent on food and transportation is nearly equal. For example, food accounts for just 26.24% of upper-class expenditures this year, while transportation makes up 15.29%.
Spending on clothing has surged from 8.44% in 2014 to 18.54% this year. Other goods and services have also seen an increase, rising from 4.74% in 2014 to 11.26% in 2024.
The rising financial strain on Indonesia’s middle class is becoming increasingly evident, as more of their income is directed toward basic necessities like food. With the decline in Indonesian middle class, dropping into the vulnerable class, economic stability is under threat. Thus, raising concerns about the long-term impact on the country’s overall economic resilience.
(Raidi/Agung)
