Indonesia's Social Enterprises are Mushrooming: How are their Incomes?

Social enterprises in Indonesia are increasingly developing in line with the growing awareness of accelerating social change or even protecting the environment.

Research by the British Council, published by the International Labour Organization (ILO), estimates that there were 342,000 social enterprises in 2018. However, only 2,000 of them had been identified that year.

The three largest sectors for social enterprises include the creative industry (22% of the total number of social enterprises), agriculture and fisheries (16%), and education (15%) in 2018.

The British Council explains that in 2017, the creative sector contributed more than 7% to the gross domestic product (GDP) and employed approximately 15.9 million people.

"In 2020, we estimate a value of approximately Rp1.924 trillion (approximately US$130 million). The social enterprise sector has the potential to contribute 1.9% to GDP," wrote the British Council in its report *Supporting Social Enterprises in Indonesia 2021*.

With that contribution, the British Council also calculated an estimated income of US$57,000 per year or Rp895.07 million (assuming an exchange rate of Rp15,703 per US$) for each social enterprise. This figure is derived from the average income of 64% of micro-scale social enterprise respondents.

The British Council also predicts that the total revenue of all Indonesian social enterprises could reach US$19.6 billion or Rp307.77 trillion.

Besides generating such revenue, several parties also benefit from social enterprises, namely the community (63%), women (48%), and young people (44%).

"Creative and social businesses create more jobs for women, young people, people with disabilities, and communities than other businesses in Indonesia," wrote the research team.

The British Council observes that the number of social enterprises established in Indonesia has been steadily increasing since 2012, but experienced a significant increase in 2021. From a demographic perspective, social enterprises are more often led by young people aged 25-34.

"The rise of social enterprises in Indonesia is also good news for gender equality. The workforce of social enterprises is estimated to consist of 69% women," said the research team.

(Also read: [Indonesia's Ease of Doing Business Index, What Needs Improvement?](https://databoks.katadata.co.id/datapublish/2023/10/13/indeks-kemudahan-berbisnis-indonesia-apa-yang-perlu-ditingkatkan))