Indonesia faces poverty and aging population challenges

Indonesia is facing significant socio-economic shifts regarding poverty and demographic aging. According to data from the Central Bureau of Statistics (BPS), the poverty rate in March 2026 stood at 8.07 percent, representing 22.93 million people. To address this, the National Institute of Public Administration (LAN) is emphasizing the need for cross-sector policy orchestration, focusing on data integration, adaptive social assistance, and human capital investment to break intergenerational poverty cycles.

Simultaneously, research by the DBS Foundation highlights a looming demographic transition. Indonesia's elderly population reached 12 percent in 2025 and is projected to exceed 20 percent by 2045. The study reveals a lack of preparedness for this aging society, noting that only 5.37 percent of the population owns a pension fund. Furthermore, 82.96 percent of the elderly are financially dependent on working family members, and 55.32 percent of seniors remain in the workforce, with a vast majority working in the informal sector.