• Home
  • Politics
  • Health
  • World
  • Business
  • Finance
  • Tech
  • More
    • Sports
    • Entertainment
    • Lifestyle
What's Hot

How Smart Mattresses Improve Sleep Quality For Couples

May 9, 2025

OpenAI CEO Warns: ‘Not A Huge Amount Of Time’ Until China Overpowers American AI

May 9, 2025

Short and Funny Sayings for a Happy Summer with Friends

May 9, 2025
Facebook Twitter Instagram
  • Contact
  • Privacy Policy
  • Terms & Conditions
Friday, May 9
Patriot Now NewsPatriot Now News
  • Home
  • Politics

    Security video shows brazen sexual assault of California woman by homeless man

    October 24, 2023

    Woman makes disturbing discovery after her boyfriend chases away home intruder who stabbed him

    October 24, 2023

    Poll finds Americans overwhelmingly support Israel’s war on Hamas, but younger Americans defend Hamas

    October 24, 2023

    Off-duty pilot charged with 83 counts of attempted murder after allegedly trying to shut off engines midflight on Alaska Airlines

    October 23, 2023

    Leaked audio of Shelia Jackson Lee abusively cursing staffer

    October 22, 2023
  • Health

    Disparities In Cataract Care Are A Sorry Sight

    October 16, 2023

    Vaccine Stocks—Including Pfizer, Moderna, BioNTech And Novavax—Slide Amid Plummeting Demand

    October 16, 2023

    Long-term steroid use should be a last resort

    October 16, 2023

    Rite Aid Files For Bankruptcy With More ‘Underperforming Stores’ To Close

    October 16, 2023

    Who’s Still Dying From Complications Related To Covid-19?

    October 16, 2023
  • World

    New York Democrat Dan Goldman Accuses ‘Conservatives in the South’ of Holding Rallies with ‘Swastikas’

    October 13, 2023

    IDF Ret. Major General Describes Rushing to Save Son, Granddaughter During Hamas Invasion

    October 13, 2023

    Black Lives Matter Group Deletes Tweet Showing Support for Hamas 

    October 13, 2023

    AOC Denounces NYC Rally Cheering Hamas Terrorism: ‘Unacceptable’

    October 13, 2023

    L.A. Prosecutors Call Out Soros-Backed Gascón for Silence on Israel

    October 13, 2023
  • Business

    OpenAI CEO Warns: ‘Not A Huge Amount Of Time’ Until China Overpowers American AI

    May 9, 2025

    Trump Announces First Post-Tariff Trade Deal

    May 8, 2025

    Electric Vehicle Sales Nosedive As GOP Takes Buzzsaw To Biden’s Mandate

    May 7, 2025

    Tyson Foods Announces It Will Bend The Knee To Trump Admin’s New Rules

    May 7, 2025

    Federal Reserve Holds Interest Rates Steady Despite Pressure From Trump

    May 7, 2025
  • Finance

    Ending China’s De Minimis Exception Brings 3 Benefits for Americans

    April 17, 2025

    The Trump Tariff Shock Should Push Indonesia to Reform Its Economy

    April 17, 2025

    Tariff Talks an Opportunity to Reinvigorate the Japan-US Alliance

    April 17, 2025

    How China’s Companies Are Responding to the US Trade War

    April 16, 2025

    The US Flip-flop Over H20 Chip Restrictions 

    April 16, 2025
  • Tech

    Cruz Confronts Zuckerberg on Pointless Warning for Child Porn Searches

    February 2, 2024

    FTX Abandons Plans to Relaunch Crypto Exchange, Commits to Full Repayment of Customers and Creditors

    February 2, 2024

    Elon Musk Proposes Tesla Reincorporates in Texas After Delaware Judge Voids Pay Package

    February 2, 2024

    Tesla’s Elon Musk Tops Disney’s Bob Iger as Most Overrated Chief Executive

    February 2, 2024

    Mark Zuckerberg’s Wealth Grew $84 Billion in 2023 as Pedophiles Target Children on Facebook, Instagram

    February 2, 2024
  • More
    • Sports
    • Entertainment
    • Lifestyle
Patriot Now NewsPatriot Now News
Home»Finance»Is Indonesia’s Middle Class Really Shrinking?
Finance

Is Indonesia’s Middle Class Really Shrinking?

September 24, 2024No Comments5 Mins Read
Facebook Twitter Pinterest LinkedIn Tumblr Email
Is Indonesia’s Middle Class Really Shrinking?
Share
Facebook Twitter LinkedIn Pinterest Email

Indonesia’s Central Statistics Agency (BPS) recently announced that the middle class in the country is shrinking. In 2019, the total middle class population numbered 57.33 million. According to BPS’s most recent data, the figure in March 2024 was 47.85 million. On its face, this would mean around 9.5 million people have fallen out of the middle class over the last five years, which is being attributed to various factors including the COVID-19 pandemic, job losses in the manufacturing sector, and a recent increase in the consumption tax.

But we have to be careful when using the middle class as an analytical tool because there is no universal definition of what it is, or how it should be measured. And the size of the middle class in any economy depends entirely on how it is defined and measured. Indonesia is using the World Bank as a reference point, based on a 2019 report that argued the Indonesian middle class was growing.

That World Bank report is pretty open about the conceptual ambiguity here, writing that there “has been a surge of interest in the Indonesian middle class in recent years, but little agreement on who they are or how numerous they are.” The authors of the report go on to note that there were four major reports attempting to calculate the Indonesian middle class between 2010 and 2019 and all used different definitions, arriving at wildly varied estimates of between 30 and 81 million people.

The World Bank report measures expenditures and uses multiples of the poverty line to establish categories including poor, vulnerable, aspiring middle class, and middle class. It argued that as of 2019, the middle class in Indonesia (defined as people who spent between 1.2 and 6 million rupiah per month) was the fastest growing group in the country. But the authors were also careful to note that the “size of the middle class, the characteristics of its members, and their roles depend on how we define them.”

See also  The Jakarta-Bandung High-Speed Railway: Indonesia’s Lessons Learned 

In the latest BPS data from 2024, although the middle class (defined here as people who spend between 2 and 9 million rupiah per month) shrank by 9.5 million, the aspiring middle class category increased by around 8.65 million. That means the total combined population of middle class and middle class aspirants remained roughly unchanged from five years ago, only the distribution has shifted. We don’t know exactly why that is, but we do know the distribution is heavily dependent on how the upper and lower bounds of these categories are defined in the first place.

This is why measuring, and making definitive claims about, the middle class is a tricky business. However, the 2019 World Bank report also identifies certain characteristics of a growing middle class, such as a tendency for consumers to spend more of their income on discretionary purchases like travel and entertainment as opposed to necessities like food and shelter. Do we see evidence of these kinds of discretionary purchases declining in Indonesia, which would be consistent with a shrinking middle class? Not really. In fact, we see evidence of the opposite.

Since 2019 BPS has been tracking domestic tourist activity (which includes business, leisure and trips to see family or friends). Domestic travel in 2023 was 16 percent higher than it was in 2019, the year when the middle class apparently had 9.5 million more members than it does today.

We also see strong growth in other discretionary purchases like movie tickets, with Indonesian consumers turning out in record numbers at the box office lately and major theater chains investing big in expansion to keep pace with demand. This is not conclusive evidence, but it is generally consistent with increasing purchasing power rather than a hollowing out of the middle class.

See also  What Modi’s UAE Trip Means for IMEC

I don’t doubt that the pandemic caused a large number of formal sector workers to shift into the informal economy, and some of them undoubtedly never came back. I also don’t doubt that there are economic headwinds causing job losses in some sectors and regions, or that there is weakness in manufacturing. But when we look at Indonesia’s recent record of economic growth, even just the few years since the pandemic, it has been pretty strong. And if the economy is growing while the middle class is shrinking, where are the gains from this growth going?

You could argue that it’s all being captured by a narrow elite at the upper crust of the social ladder, or that growth is being powered almost exclusively by investment that doesn’t generate jobs or widespread income gains. But you have to do a bit of contorting to get there. The simpler explanation would be to acknowledge that defining and measuring the middle class is hard and imprecise, and that the recent report from BPS is just one piece of a larger economic picture.

Class Indonesias Middle Shrinking
Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

Related Posts

Ending China’s De Minimis Exception Brings 3 Benefits for Americans

April 17, 2025

The Trump Tariff Shock Should Push Indonesia to Reform Its Economy

April 17, 2025

Tariff Talks an Opportunity to Reinvigorate the Japan-US Alliance

April 17, 2025

How China’s Companies Are Responding to the US Trade War

April 16, 2025
Add A Comment

Leave A Reply Cancel Reply

Top Posts

Police Investigating Shooting Near Beach Boardwalk In Hollywood, Florida

May 30, 2023

No Illegal Drugs Found in Deceased Actor Matthew Perry’s Home

October 30, 2023

Actress Sarah Paulson Buys Out Tickets for Dallas Showing of Transgender Film

May 29, 2023

Duchenne breakthrough therapy leaves behind pioneering families

June 30, 2023
Don't Miss

How Smart Mattresses Improve Sleep Quality For Couples

Lifestyle May 9, 2025

Sharing a bed with your partner can be romantic… until it’s not. One of you…

OpenAI CEO Warns: ‘Not A Huge Amount Of Time’ Until China Overpowers American AI

May 9, 2025

Short and Funny Sayings for a Happy Summer with Friends

May 9, 2025

Trump Announces First Post-Tariff Trade Deal

May 8, 2025
About
About

This is your World, Tech, Health, Entertainment and Sports website. We provide the latest breaking news straight from the News industry.

We're social. Connect with us:

Facebook Twitter Instagram Pinterest
Categories
  • Business (4,111)
  • Entertainment (4,220)
  • Finance (3,202)
  • Health (1,938)
  • Lifestyle (1,628)
  • Politics (3,084)
  • Sports (4,036)
  • Tech (2,006)
  • Uncategorized (4)
  • World (3,944)
Our Picks

New Details Emerge In Stetson Bennett’s Arrest

March 1, 2023

Elon Musk Accuses Microsoft of Violating Twitter’s Data Usage Agreement

May 22, 2023

I’m Not Ready to Convict Daniel Penny

May 19, 2023
Popular Posts

How Smart Mattresses Improve Sleep Quality For Couples

May 9, 2025

OpenAI CEO Warns: ‘Not A Huge Amount Of Time’ Until China Overpowers American AI

May 9, 2025

Short and Funny Sayings for a Happy Summer with Friends

May 9, 2025
© 2025 Patriotnownews.com - All rights reserved.
  • Contact
  • Privacy Policy
  • Terms & Conditions

Type above and press Enter to search. Press Esc to cancel.