Five Times Eid, Shopping Continues to Decrease (6)

JAKARTA, KOMPAS — The ability to shop before Lebaran is reduced because of low purchasing power of residents. In fact, the level of consumption of residents at that moment is higher than the usual time period. The hope of a vibrant economy could be missed.

The Kompas Daily Data Journalism Team processed the 2020-2024 Bank Indonesia (BI) Consumer Survey Monthly Data. In the last five years, the average proportion of people's spending before Eid has been smaller compared to the proportion of consumption spending for one year.

In 2020 and 2021, the proportion of spending before Eid was 0.3 percentage points each, but in 2022 it dropped to 0.1 percentage points. In 2023 it was the same as the average proportion of spending in that year or 0 points. In 2024 it dropped even more sharply, to minus 0.4 percentage points. The proportion of spending before Eid 2024 was the lowest in the last five years.

The decline in consumption during Eid is also seen from household consumption expenditure in the gross domestic product (GDP) structure. During 2021-2024, household consumption during the Eid period, which was in the second quarter, grew slowly. In 2021, household consumption in the same period grew by 5.96 percent. Then in 2024, it slowed to 4.93 percent.

Sep (29), a resident of East Java, also plans to reduce his consumption for Eid this year. This father of one recently lost his job. Sep's contract as an Individual Consultant at a government agency in East Java was not extended as of February 1, 2025.

Previously, Sep received a salary of IDR 5 million per month, which he usually set aside for savings of IDR 500,000, the needs of his toddler's formula milk of IDR 1.6 million and the rest for daily needs. Now Sep must save his expenses including consumption before Eid because the remaining savings can only cover daily needs until this month. To make ends meet, Sep tries to find a new job including trying to register as an application motorcycle taxi.

"I'm also confused about this. Usually during Eid I buy parcels to share with my closest family. Maybe I'll stop buying them now. The consumption is for the family first, for others later," said Sep, Tuesday (2/18/2025).

The decreasing proportion of consumption during big days also occurs in the distribution of online loan funds or pinjol. This can be seen from the monthly data from the Financial Services Authority (OJK) regarding the distribution of fintech lending loans in the last four years. The average growth in loan distribution in the two months leading up to Eid from 2021 to 2024 continues to decline.

In 2021, online loans grew by an average of 13.2 percent per month. In February 2021, the total disbursement was IDR 9.6 trillion, then in March 2021 it rose to IDR 11.8 trillion and rose again to IDR 12.2 trillion in April 2021.

Meanwhile, ahead of Eid 2022, online loan distribution growth fell to 8.6 percent. Then two months before Eid 2023, it fell again to only 2.8 percent and ahead of Eid 2024, it fell again to only 1.8 percent.

The slowing growth of online loan distribution is intertwined with the weakening of people's spending power, especially ahead of Eid. This is inseparable from the use of online loans which are identical to consumption or financing daily needs. The fewer loans that are distributed, the fewer goods that are spent by residents.

The decline in credit growth ahead of Lebaran compared to previous years could be an alarm for the national economy. Responding to this, senior researcher at The PRAKARSA Setyo Budiantoro assessed that the moment before Lebaran which has been considered to be an economic driver, turns out not to be entirely reliable.

"Limited purchasing power, then many people anticipate. Because they do not know what their future will be like, so their purchasing power is limited first," said Budi, Friday (2/14/2025).

According to Budi, people's shopping decisions depend on their expectations. They will make large purchases because the expectations in the future are considered safe. In the sense that economic conditions will remain good. If those expectations are felt by the people, purchasing power has the potential to increase.

Meanwhile, people who hold back on shopping ahead of Eid can be seen from the annual deflation that occurred in February 2025, amounting to 0.09 percent. Meanwhile, in 2024, two months before Eid, there was an increase in inflation, from 2.57 percent in January 2024, to 2.75 percent in February, and during Eid (March) to 3.05 percent.

The government is optimistic about seeing quarterly consumption growth in a year driven by the Lebaran moment. Secretary of the Coordinating Ministry for Economic Affairs Susiwijono sees the highest growth in the last few years still occurring in the second quarter, during Lebaran.

According to Susi, the shift in high volumes of public consumption has the potential to occur outside of the Eid holiday.

"There are several points of momentum in the annual cycle such as Harbolnas (National Online Shopping Day). Children now tend to ask to be bought new clothes at that time (Harbolnas) rather than Lebaran," he said, Friday (29/2/2025).

On the other hand, the government is committed to continuing to encourage people's purchasing power. Susi explained that the government's encouragement ahead of Eid is one of them through the provision of holiday allowances for state civil servants (ASN) and non-ASN. There is also a 20 percent discount on toll road rates and a discount on plane tickets during the 2025 Eid homecoming period.

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