The Face of Inequality in Indonesia

It requires serious handling of the problem of inequality in various aspects of life which has the potential to give rise to social conflict.

The following article was translated using both Microsoft Azure Open AI and Google Translation AI. The original article can be found in Wajah Ketimpangan di Indonesia

HERYUNANTO

Illustration

The issue of inequality in Indonesia remains a continuously developing topic. With a population of over 270 million people, the issue of inequality remains one of the challenges yet to be resolved.

Despite having abundant resources and continuously improving economic growth, the level of inequality is still relatively high. In March 2023, the level of expenditure inequality measured by the Gini ratio reached 0.388.

This figure has increased from the previous period and is even the highest during the period of September 2018 to March 2023.

Economic inequality

The Gini ratio is the most commonly used measure in measuring inequality. The Gini ratio ranges from 0 (zero) to 1 (one), where the closer it gets to 1 indicates a higher level of inequality.

This means that the level of inequality in Indonesia in March 2023 is increasing compared to previous years.

In addition to the Gini ratio, another measure of inequality that is often used is the percentage of expenditures among the bottom 40 percent of the population, known as the World Bank measure.

Based on this measurement, inequality levels can be divided into three categories. Namely, high inequality level if the percentage of expenditure of the bottom 40 percent of the population is below 12 percent, medium inequality if it ranges between 12-17 percent, and low inequality if it is above 17 percent.

Despite having abundant resources and continuously increasing economic growth, the level of inequality is still quite high.

In March 2023, the percentage of expenditures for the bottom 40 percent of the population is 18.04 percent. According to the World Bank criteria, this figure falls under the category of low inequality.

However, upon further examination, the percentage decreased by 0.20 percentage points from the condition in September 2022, which was 18.24 percent.

Meanwhile, the expenditure percentage of the top 20 percent of the population increased by 0.12 percentage points from 45.98 percent in September 2022 to 46.71 percent in March 2023.

This indicates that the distribution of expenditure among the Indonesian population is almost 50 percent within the top 20 percent of the population.

Not only economic inequality, various other inequalities or gaps are still a problem.

Educational inequality

Inequality in the education aspect, for example, based on the results of the National Socioeconomic Survey (Susenas) held by BPS in March 2022, the pure participation rate (APM) of all education levels in urban areas is larger than in rural areas.

APM is one of the indicators included in the Sustainable Development Goals (SDGs) indicators to measure the inequality of educational participation.

A densely populated residential area with towering buildings in the background in Jakarta, Friday (23/12/2022).

In addition to the APM, rural residents aged 15 years and older also have lower literacy rates (AMH) compared to urban areas (94.21 percent compared to 97.91 percent).

Furthermore, if seen according to household economic status, the higher the economic status, the higher the achievement of AMH for individuals aged 15 and above. This certainly needs special attention.

Apart from realizing the SDGs principle, namelyleave no one behind, increasing the literacy skills of the population will also have a multiplier effect (multiplier effect) on development.

This is because literacy skills have an impact on community empowerment and the improvement of their quality of life, which ultimately also affects the participation of the population in employment, the reduction of poverty rates, and so on.

The results of Susenas also showed that in March 2022, the percentage of out-of-school children and dropouts in rural areas was higher than in urban areas. Differences in education level achievements between residents living in rural and urban areas are still apparent.

Most residents aged 15 and above in urban areas are graduates of high school or equivalent, while in rural areas, they are mostly graduates of elementary school or equivalent.

A significant gap can also be seen among the population who have graduated from college, in which in urban areas it reaches 13.51 percent, while in rural areas only 5.57 percent.

In terms of health, the gap in access to basic services is still felt.

Health access

In terms of health, the gap in access to basic services is also still felt. Based on BPS data, the proportion of households with access to basic sanitation services in rural areas in 2022 is 76.99%, while in urban areas it reaches 83.80%.

Similarly, with access to basic healthcare facilities, rural areas have a lower level of access (75.37 percent) compared to urban areas (82.22 percent). This highlights the growing need to bridge the gap so that all Indonesian citizens can enjoy their basic right to proper healthcare.

Data also shows that in March 2022, the percentage of women aged 10-54 who have been married (PPK) and have given birth in the past two years with the assistance of a health professional during the first and last stages of childbirth for their last child is higher in urban areas than in rural areas.

As for the economic status seen from the expenditure quintile, the higher the mother's economic status, the higher the percentage as well.

SUPRIYANTO

Supriyanto

Comprehensive policy

The problem of inequality in various aspects of Indonesian society requires serious action from the government and various stakeholders.

Despite statistical data, whether it is economic inequality, education, health, or other aspects of inequality, besides affecting the welfare of society, it is also feared to trigger tension and vulnerability towards social conflicts. Therefore, it is important to design comprehensive policies to address inequality, including improving access to quality education and equalizing access to health services.

Partnership programs that support the development of the economy in rural or remote areas also need to be expanded and improved. Economic empowerment through skills training and support for micro and small businesses in rural areas is expected to help reduce the continuing inequality.

Also read: Uneven Recovery, Inequality Sharpens

Lili Retnosari Statistics at the Central Bureau of Statistics