The Collapse of Our Middle Class
The title of this piece is inspired by ‘Robohnya Surau Kami’ (1955) by the literary figure A.A. Navis. That short story bitterly depicted the collapse of an institution due to the neglect and indifference of the surrounding community. Seven decades later, this metaphor is once again contextual for reading a phenomenon currently testing us: slowly but surely, Indonesia’s middle class is collapsing.
If the prayer house in the short story symbolises neglected spirituality, then the middle class today represents the nation’s economic resilience, which is currently gasping for air. When this group weakens, what is threatened is not merely a statistical figure on a desk, but the future of millions of families whose dreams of prosperity are drifting further away.
We can see this honestly around us. From social media to coffee shop conversations, there is a similar anxiety shared by office workers, educators, healthcare professionals, and micro-entrepreneurs. They are the group that does not qualify as poor enough to receive social assistance, yet is not wealthy enough to escape the economic storm.
Every month, they must perform financial ‘acrobatics’. The prices of rice, oil, and kitchen spices are creeping up. On the other hand, bills for children’s education, health insurance, and transportation costs following the increase in non-subsidised fuel continue to drain savings. Their income moves like a tortoise, while the price of basic necessities soars like a meteor. The phenomenon of ‘eating into savings’ is becoming increasingly common just to survive until the end of the month.
Yet, the middle class is the main pillar supporting the national economy. Data from the Central Bureau of Statistics (2024) shows that the middle class and the ‘aspiring middle class’ comprise 66.35 per cent of the total population and contribute 81.49 per cent of national consumption. The wheels of business thrive on the purchasing power of this group. Economist Simon Kuznets (195lar) explained that a country with a strong middle class has a much more solid foundation for development, as they serve as both a social balancer and the most compliant taxpayers.
Anatomy of ‘downward mobility’
However, BPS data (2024) sends an emergency signal. The number of Indonesia’s middle class has steadily declined from 57.33 million people in 2019 to 47.85 million in 2024. This means that in the last five years, approximately 9.48 million people have been pushed out of the middle-class comfort zone and fallen into the vulnerable group.
These are not just dead numbers. Behind them are millions of stories of parents forced to move their children to cheaper schools or the bitter decision to cut daily nutritional intake. According to World Bank indicators, the majority of our middle class are ‘aspiring middle class’ who are vulnerable. Any economic shock, whether it be serious illness, layoffs, or a surge in food prices, can immediately throw them into the abyss of poverty.
This real condition is reflected in the ‘downtrading’ phenomenon, as confirmed by Bank Mandiri economist Andry Asmoro (2024). To manage thinning wallets, consumers are collectively switching to much cheaper products, delaying the purchase of durable goods, and even cutting travel budgets. Economist Mohammad Faisal (2024) emphasises that the weakening purchasing power of this group is a yellow light for the national economy, given that household consumption is the largest contributor to our GDP.