LPEM UI Survey: Inflation and Labour Market Stagnation in Indonesia Under Spotlight
Jakarta, CNBC Indonesia - Economists assess that Indonesia’s economic conditions are currently far from favourable. This evaluation emerged from a survey conducted by LPEM FEB UI on 85 economic experts from 24 February to 9 March 2026.
The results show that 41 out of 85 (48%) believe Indonesia’s current economic conditions have deteriorated compared to the previous quarter.
Meanwhile, 32 (38%) see no improvement or decline. This leaves only 12 (14%) who view the current conditions as improving.
“The average response of -0.39 reflects the experts’ tendency to assess the economy as deteriorating or stagnant, with a high confidence score of 7.37 out of 10,” quoted from the LPEM FEB UI survey report on Monday (30/3/2026).
Experts assess that inflationary pressures on Indonesia’s economy have increased compared to three months ago. The majority, 57 out of 85 experts (67%), believe inflation has risen, while 23 (27%) see it unchanged, and only 5 (6%) view it as easing.
LPEM FEB UI notes an average response of +0.71, reflecting a clear trend towards increasing inflationary pressures in the current period.
This is a worrying signal, as rising inflationary pressures mean higher prices for goods and services, which gradually erode the purchasing power of Indonesian society.
These results indicate a significant jump from the previous survey average of +0.47, “indicating that experts’ concerns about inflation are not only persisting but also strengthening. A relatively high confidence score of 7.60 out of 10 accompanies this assessment.”
In evaluating the current labour market conditions, the majority of experts, 30 out of 85 (35%), rate it as unchanged compared to three months ago.
However, the weight of those considering it increasingly tight—44 experts (56%)—is sufficient to pull the overall assessment into negative territory, leaving only 11 (13%) who view the labour market as loosening.
The average response of -0.55 reflects a labour market generally assessed by experts as stagnant but with significant underlying concerns. A relatively moderate confidence score of 7.46 still indicates strong and certain responses from respondents.
Experts also assess that the current business environment has deteriorated compared to three months ago. The largest portion, 38 out of 85 (45%), view conditions as worse, followed by 25 (29%) who see no change, and 14 (16%) who rate it much worse.
These two negative categories combined depict a gloomy business climate, with only 8 (9%) seeing improvement.
The average response of -0.67 with a relatively high confidence score of 7.66 reflects a clear negative trend in the experts’ assessment of the current business environment.
“These results show a decline from the assessment that had briefly improved in the previous round (-0.45), confirming that the short-lived improvement in sentiment among experts did not last, as conditions are again assessed to be on a downward trajectory.”