Tourists from around the globe flock to Bali for its lush resorts, five-star restaurants, and booming nightlife. But behind the island’s postcard-perfect image lies a stark economic reality for many of its local workers: the minimum wage is far from enough to live on.
Despite Bali’s international reputation as a luxury destination, the wages earned by many of its residents—especially those working in tourism—remain well below what is considered a decent living standard, according to Ida Bagus Raka Suardana, a professor at the Faculty of Economics and Business at Universitas Pendidikan Nasional (Undiknas) Denpasar.
“The gap between the minimum wage and the cost of living in Bali is still a serious issue,” Raka told detikBali on 1 May. “It affects community welfare and hinders local economic growth.”
A luxury island, low-income workers
The provincial minimum wage for Bali in 2025 has been set at Rp 2.996.561 per month, a 6,5% increase from the previous year. However, living expenses in Bali vary widely depending on location and lifestyle, ranging from Rp 2,5 million to as high as Rp 30 million monthly, Raka noted.
“That means for workers earning the minimum wage, even meeting basic needs can be a struggle—especially in high-tourism areas like Ubud and Kuta,” he said.
Compounding the issue, many Balinese workers remain heavily reliant on informal or seasonal tourism-related jobs, offering little to no long-term income stability.
Raka argues that the current minimum wage policy does not reflect the economic reality faced by locals. He is calling for a more comprehensive approach to close the gap.
“We need adjustments to the minimum wage based on a living wage standard, stronger support for informal sector workers through training and empowerment, and social policies that uplift community welfare,” he said. “Local governments face a dilemma—between keeping the tourism industry competitive and ensuring workers can meet basic living standards.”
Profits for outsiders, not locals
Raka also pointed to deeper structural problems. The booming tourism sector, he said, disproportionately benefits large-scale investors and business owners, many of whom come from outside Bali—or even outside Indonesia—while local workers remain confined to low-paid roles.
“The imbalance isn’t just economic, it’s a matter of social justice,” he said. “Tourism in Bali has expanded rapidly, but the profits are enjoyed mainly by a few major players, not the local community.”
The consequences, Raka explained, are far-reaching: shrinking purchasing power, rising poverty, and widening inequality.
“Some studies show that low minimum wages have a significant negative impact on income distribution. This ultimately affects the overall well-being of local communities,” he said.
Cultural costs and economic pressure
Bali’s local residents face an additional burden not shared by most workers elsewhere. Beyond basic needs, they must allocate part of their income to fulfill cultural obligations and religious ceremonies—crucial components of Balinese life, and ironically, one of the key attractions for visitors.
“The 2025 minimum wage is clearly insufficient to keep pace with rising food prices, rent, or the social and cultural expenses that are part of everyday life in Bali,” Raka said. “While the tourism sector presents a luxurious face to the world, many of its workers are still struggling to cover basic costs.”
