Jokowi on Middle Class Decline: All Countries Face Similar Issue
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30 August 2024 23:00 WIB
TEMPO.CO, Jakarta - President Joko "Jokowi" Widodo stated that the decline of the middle class to the brink of vulnerable poverty is not unique to Indonesia. “This issue exists in almost all countries due to the global economic downturn and [the lingering effects of] the COVID-19 pandemic that occurred 2-3 years ago,” he told journalists at the Persahabatan Hospital in East Jakarta, on Friday, August 30, 2024.
The number of Indonesians classified as middle class has significantly decreased in recent years, according to data from the Central Statistics Agency (BPS). From 57.33 million people in 2019, the middle-class population has declined to 47.85 million in 2024, representing a loss of 9.48 million individuals.
BPS Head Amalia Adininggar attributed this decline to the long-term scarring effects of the COVID-19 pandemic. “In 2021, the middle class numbered 53.83 million, accounting for 19.82 percent of the population. By 2024, this figure had decreased to 47.85 million, or 17.13 percent," Amalia explained during a meeting with Commission XI of the House of Representatives (DPR) at the Parliament Complex in Central Jakarta, Wednesday, August 28, 2024.
Concurrently, there has been an increase in the number of people categorized as aspiring middle class, a group positioned between the vulnerable poor and the middle class. BPS data reveals that in 2024, 137.5 million people, or 49.22 percent of the total population, will fall into this category.
“These 137.5 million individuals have the potential to move into the middle class with appropriate support, she noted.
However, Amalia warned that many within the current middle class are situated at the lower end of the group, with an average per capita monthly expenditure of around Rp2.04 million. “This makes them vulnerable to [economic] shocks that could push them back into the aspiring middle class,” she cautioned.
Amalia also clarified that BPS employs the World Bank criteria, defining the middle class as those with expenditures ranging from 3.5 to 17 times the poverty line. The aspiring middle class, on the other hand, has expenditures between 1.5 and 3.5 times the poverty line.
DANIEL A. FAJRI | MHD RIO ALPIN PULUNGAN
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