Medan, Indonesia – Halimah Nasution and her husband, Agus Saputra, once stood as examples of success within Indonesia’s vibrant middle class, operating a flourishing business dedicated to renting supplies for various celebrations, including weddings, graduations, and birthdays. Their monthly earnings, amounting to approximately 30 million rupiahs (,917), allowed them to enjoy a comfortable lifestyle despite distributing a portion of their income to several siblings.
However, the advent of the COVID-19 pandemic brought sweeping restrictions on communal gatherings and events across Indonesia, significantly impacting those whose livelihoods revolved around social celebrations. The couple’s business faced a catastrophic downturn, leading to a profound change in their circumstances. Nasution reflects on that period, describing the loss as overwhelming.
As the couple struggles to regain their financial footing, they are not alone. The Indonesian economy has seen a substantial decline in its middle class, with data from the Central Bureau of Statistics revealing a drop in the number of individuals classified as middle class from 57.3 million in 2019 to 47.8 million in 2023. Meanwhile, the segment identified as part of the “aspiring middle class” has grown, indicating a shift in economic realities as approximately two-thirds of Indonesia’s 277 million people navigate these changing dynamics.
Several factors contribute to this troubling trend, as noted by Ega Kurnia Yazid, a policy expert focusing on poverty reduction. He highlights the limited social assistance available to this crucial group, who contribute substantially to Indonesia’s tax revenues yet receive relatively little support during crises. Such observations resonate particularly with Nasution and her husband, who found little assistance from the government after their business collapse.
Despite facing these challenges, Indonesia’s economy is on a path to recovery, with annual GDP growth hovering around 5 percent. Yet, the nation remains sensitive to fluctuations in global trade, particularly as key partners like the United States and China experience economic contractions, thereby impacting demand for Indonesian commodities.
Economic expert Adinova Fauri points out that the restructured labor landscape has contributed to the struggles of the middle class, as many have shifted from manufacturing jobs to the informal service sector, often undermining income stability and benefits. Experts agree that to revitalize the economy and the middle class, Indonesia must enhance labor conditions and productivity levels, making the workforce more competitive globally.
In December 2023, the inauguration of President Prabowo Subianto has infused the public with renewed optimism. His campaign promises include ambitious targets for GDP growth and a commitment to eradicate poverty through social initiatives such as a free school lunch program.
Meanwhile, Nasution and her family are actively seeking to piece together their pre-pandemic lives. After selling assets, including their car and land, they are currently employed in lower-wage jobs that leave them just shy of the two-million-rupiah threshold necessary to classify as middle class. As they navigate these economic challenges, Nasution remains hopeful that with perseverance and faith, their situation will improve.
The resilience of individuals like Nasution and her husband exemplifies the broader narrative of adaptability and hope amid adversity, embodying the spirit that continues to define Indonesia’s vibrant society.
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