More Resilient to Shocks, the Food and Beverage Industry Surges

Amid the sluggishness of Indonesia's manufacturing industry in the past decade, the food and beverage industry has grown rapidly. This industry also absorbs more labor.

More Resilient to Shocks, the Food and Beverage Industry Surges

Amidst the downturn in Indonesia's manufacturing industry in the past decade, the food and beverage industry is growing rapidly. This industry also absorbs more labor.

The food and beverage (F&B) industry in Indonesia is growing more convincingly than the manufacturing sector as a whole. In 2014, the F&B sector's contribution to gross domestic product (GDP) reached 5.32%. It will gradually increase to 6.92% by 2024. 

This increase shows that domestic demand for food and beverage products remains strong, even amid economic uncertainty. The sector's GDP value-added continues to climb year-on-year. Over a decade (2014-2024), the F&B sector's value-added GDP more than doubled, from IDR 562 trillion to IDR 1,531.4 trillion.

The increase in the food and beverage industry is somewhat different from the trend of the Indonesian Manufacturing Index (PMI) from Bank Indonesia (BI), which fluctuates, even tends to decline.

In 2022, the manufacturing index showed a strong performance with a score of 53.3 in Q1, but then fell slightly in the following quarter. In 2023, the index was slightly lower and continued until Q1 2024.

Until Q2 2025, the food and beverage industry was also the business sector that drove the expansion index to a score of 54. It is predicted that expansion will still occur in Q3 although the score will drop to 52.01. In PMI, an index value above 50 indicates an expansion indicator.

In addition, as one of the labor-intensive industries, the F&B industry absorbs a large number of workers. Competing with the textile and apparel industries, the increase in labor in the F&B industry is even more consistent. Until 2023, this industry managed to absorb 1.3 million workers. 

As an industry that focuses on basic needs, this sector has relatively stable demand despite price changes. This means that the demand for food and beverages is not greatly affected by changes in prices or economic conditions. People always need food and beverages, no wonder this sector is immune to economic shocks.