While Bali is a popular tourist destination, not all its residents enjoy the same level of economic welfare. Even though the island has experienced a decline in poverty over the last few years, inequality is on the rise.

The minimum wage in Bali is revised every year and varies across its nine regencies. As of January 2023, it averaged around 2,840073IDR (172€) per month, and a significant number of Balinese families earn just a little above the poverty line – especially those with many children or parents who only received a limited education.

Communities in the northern part of the island are particularly affected by hardship due to geographical and demographic factors. The mountainous terrain and less fertile land in these regions make it harder for them to earn a living from agriculture, which sets them apart from the more prosperous southern areas. It needs to be said that families whose primary source of income is agriculture are already more vulnerable than others.

The distance from popular tourist areas in the south, such as Canggu, Seminyak, and Ubud, also contributes to the economic disparity. These tourist hotspots provide job opportunities and drive the economy but are not equally accessible to everyone.

But even in tourist areas, it remains a challenge for Balinese workers to meet their basic needs. As prices rise faster than the yearly increase in the minimum wage, many families not only struggle with low income but need proper sanitation facilities, healthcare coverage, education opportunities, adequate housing, and sufficient nutrition.

Additionally, Bali’s labour market is highly competitive because of its popularity as a tourist destination. The influx of workers from other parts of Indonesia seeking employment adds strain on the job market and can lead to lower salaries. Moreover, the seasonal nature of the tourism industry results in fluctuations in job availability and income. This instability makes it harder for workers to maintain stable finances, particularly during low seasons. As a result, many families go through cycles of poverty, even if they temporarily escape it.

While the minimum wage is meant to protect workers’ rights, many Balinese face circumstances that make it hard to earn even the minimum wage. One significant issue is the prevalence of informal employment, such as domestic work, street vending, construction and jobs in the hospitality sector, such as waitressing or babysitting. These jobs often lack formal contracts and legal protections. They tend to pay less and fail to offer benefits and social security.

At Volunteer Programs Forever, we are dedicated to addressing these challenges and reducing income disparities. We do this by improving access to education and skill development programs in order to create alternative employment opportunities and reduce dependence on a single industry. Empowering workers with expertise and skills opens doors to higher-paying jobs and encourages a more diverse economy.