Middle Class Shrinks in 2025 as Aspiring Segment Expands

JAKARTA, Investortrust.id — Indonesia’s middle class population declines in 2025 as economic pressures weigh on household purchasing power, while the aspiring middle class expands beyond half of the total population, according to a February 2026 report by Mandiri Institute. The shift reflects slower consumption growth among established middle-income households and a structural transition toward a more vulnerable income distribution.

Mandiri Institute, the research arm of Bank Mandiri, reported that the number of middle class residents fell from 47.9 million in 2024 to 46.7 million in 2025, a drop of 1.1 million people. Over the same period, the aspiring middle class rose from 137.5 million to 142.0 million, increasing by 4.5 million people.

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The poor population declined from 25.2 million to 23.9 million, while the vulnerable group increased slightly from 67.7 million to 67.9 million. The upper class remained broadly stable at around 1.2 million people.

In proportional terms, more than half of Indonesians now fall into the aspiring middle class category. Their share climbed to 50.4 percent in 2025, up from 49.2 percent in 2024, while the middle class share fell to 16.6 percent.

The contraction marked a deeper decline compared with previous years. Data showed the middle class had faced more severe challenges in 2025 relative to 2024, reflecting pressures on income growth and cost of living.

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Consumption patterns further illustrated the strain. Per capita consumption growth for the middle class reached 4.1 percent year on year in 2025, lower than the 6.8 percent recorded by the upper class and only modestly above vulnerable households at 5.0 percent.

Food consumption growth among the middle class slowed sharply to 0.9 percent in 2025. Non-food spending grew 6.4 percent, indicating households prioritized discretionary and durable purchases over basic goods.

Spending on durable goods led non-food growth, particularly handphones, which surged 31.2 percent year on year. Electronics, jewelry, sports equipment, and furniture also recorded strong double-digit expansion.

Mobility and transportation-related spending also supported non-food consumption. Meanwhile, energy-related spending contracted, reflecting adjustments in household expenditure allocation.

Regional disparities remained evident. West Java, East Java, and Yogyakarta recorded the largest increases in middle class population, while the steepest declines occurred in South Sumatra, Banten, and Central Java.

Mandiri Institute based its analysis on Statistics Indonesia’s 2025 National Socioeconomic Survey, applying World Bank expenditure-based classifications relative to the poverty line. The data underscored the need for policies that strengthen income resilience and sustain upward mobility.