Decline of the Middle Class Will Be a Serious Concern for the Government

JAKARTA, KOMPAS.com - Head of the Government Communication Agency (Bakom RI) Syahganda Nainggolan stated that the decline of the middle class in Indonesia will be a significant concern for President Prabowo Subianto's administration.

This was mentioned during the Special Report on Two Years of Prabowo-Gibran's Government aired by Kompas TV on Tuesday (20/10/2026).

"Our middle class has decreased by about 11 million people, shifting to the lower middle class. This indeed will be a concentration for next year, particularly in labor-intensive growth sectors," Syahganda said, as quoted from a Kompas TV YouTube broadcast on Wednesday (21/10/2026).

He noted that approximately 11 million individuals from the middle class have fallen to the lower middle class.

This situation, according to Syahganda, will attract the government's attention and will be a focus in 2027.

"The President will engage in the automotive industry next year, 2027. There will definitely be job absorption for the mentioned middle class who have been complaining. So, we need to understand that overall, the President has succeeded in achieving what is called inclusive growth and ensuring that our citizens are part of that growth," he added.

Prabowo's Comments

Meanwhile, Prabowo expressed his astonishment upon receiving reports that poverty rates had continued to rise from 2017 to 2024.

"We know that our growth over the last seven years has been 5 percent annually, meaning we have grown by 35 percent overall. Yet, how can poverty increase after growing 35 percent? Right? The number of poor and near-poor people from 2017 to 2024, that’s seven years. How can it rise?" Prabowo said during the program 'Prabowo Answers' as quoted on Friday (18/9/2026).

He was also surprised that during those seven years, the number of middle-class citizens had declined.

"Why is the middle class decreasing? This means there is something wrong with our system. This information comes from the World Bank Data Center," Prabowo added.

Dok. Sekretariat Presiden President Prabowo Subianto meeting regarding forest fire issues at the Merdeka Palace, Jakarta, Monday (12/10/2026).

Decline of the Middle Class in Indonesia

According to the Indonesia Economic Prospects (IEP) report issued in June 2026 by the World Bank, the proportion of workers earning middle-class income plummeted from 14.5 percent in 2018 to just over 7 percent by 2025.

At the same time, real wages for skilled and high-level workers have shrunk by around 1 to 2 percent per year since 2018.

The findings indicate that the economic growth in recent years has not been accompanied by a corresponding improvement in job quality and overall welfare.

This is further illustrated by data from the Mandiri Institute, which shows that the number of middle-class Indonesians decreased from 47.9 million in 2024 to 46.7 million in 2025.

Their proportion of the total population fell from 17.1 percent to 16.6 percent. In contrast, the aspiring middle class (AMC), or those just below the middle class, increased by 4.5 million people, now accounting for 50.4 percent of the population.

This signifies that more than half of Indonesia's populace lives just below the middle-class threshold, close enough to rise but vulnerable enough to fall back again.