JakartaGlobe-Oct 8
Indonesia is sitting on a potential economic goldmine with more than 70 percent of its population in the productive age group, yet experts caution that the nation risks wasting its once-in-a-lifetime demographic dividend if structural challenges are not addressed. Speaking at the Investor Daily Summit 2025 on Wednesday, behavioral economist Talitha Chairunissa of the Indonesian Economists Alliance (AEI) said Indonesia’s dependency ratio has fallen below 45 percent, meaning each 100 working-age Indonesians supports just 45 non-working-age individuals. “This is a golden window, a demographic bonus that comes only once in a nation’s history. It must not be wasted,” she said. The dependency ratio is a demographic measure comparing the number of dependents (people too young or too old to be in the workforce) to the working-age population (people aged 15-64) in a society. Despite headline GDP growth consistently above 5 percent, Talitha said productivity remains stagnant, regional disparities are significant, and the connection between economic growth and public welfare is weakening. Real wages have risen only 1.2 percent, while 80 percent of new jobs are in low-paying household sectors. The eastern regions of Papua and Maluku, she added, continue to lag far behind Java in terms of economic development. Indonesia’s unemployment rate currently sits at 4.76 percent, the lowest in two decades, yet in absolute terms, more than 7 million people remain jobless, with youth unemployment at 16.16 percent. The Manpower Ministry estimates that roughly 10.7 million Indonesians enter or seek work annually, reflecting a labor market under strain despite favorable demographic conditions. Read more at: https://jakartaglobe.id/business/indonesia-needs-784-billion-in-investment-to-reach-8-growth-by-2029?
