Economic pressure and mental resilience shape Southeast Asia’s 2026 outlook

Southeast Asia entered 2026 under sustained economic, employment, and health pressures, according to a new regional survey that highlights persistent cost-of-living stress and limited confidence in government support. The study, conducted by Milieu Insight across six Southeast Asian markets, suggests that while households remain under strain, many are adapting by prioritising self-reliance and mental wellbeing as core coping strategies.

Based on responses from 3,000 people across Singapore, Thailand, Malaysia, Indonesia, Vietnam, and the Philippines, the research paints a picture of a region where affordability concerns dominated public sentiment throughout 2025. On average, three in four respondents identified the cost of living as a key national issue, making it the most consistent concern across all markets surveyed. Singapore recorded the highest level of concern at 86%, followed by Thailand at 82% and Indonesia at 79%. The Philippines and Malaysia followed at 74% and 70% respectively, while Vietnam, though still affected, reported a comparatively lower figure of 59%.

The findings suggest these pressures are not viewed as a short-term inflationary spike. Instead, they reflect deeper structural challenges that are reshaping household priorities, consumption patterns, and expectations of institutional support as the region moves into 2026.

Cost pressures and widening gaps in government support

Rising living costs were closely linked to broader perceptions of policy effectiveness and trust in government assistance. Despite a range of interventions introduced across Southeast Asia during 2025, fewer than four in ten respondents who were concerned about affordability said government incentives or assistance helped them cope in a meaningful way. Only 39% felt that public measures made a tangible difference, pointing to a persistent gap between policy intent and lived experience.

Dissatisfaction with government support was most pronounced in the Philippines, where 59% of respondents said assistance did not help them manage rising costs. Indonesia followed closely at 54%, with Thailand and Malaysia both at 46%. Even in Singapore, often seen as a benchmark for state intervention, 40% of respondents expressed dissatisfaction with the effectiveness of support measures.

Housing affordability added further strain, particularly in urbanised and fast-growing markets. Nearly half of Singaporeans surveyed identified access to affordable housing as a major concern in 2025, while 43% of respondents in Vietnam reported similar anxieties. These pressures risk deepening inequality and delaying major life milestones, especially for younger households entering the labour and housing markets under prolonged financial stress.

Jobs, health, and the compounding effect of uncertainty

Beyond rising prices, the study highlights a convergence of vulnerabilities linked to employment insecurity and health-related anxiety. Across Southeast Asia, 42% of respondents reported concerns about job stability during 2025. Anxiety levels were highest in Singapore at 55% and Indonesia at 53%, suggesting that labour market uncertainty is not limited to informal sectors or developing economies.

The findings point to broader unease around wage growth, automation, and the long-term sustainability of existing employment models. As organisations plan for 2026, the data suggests that job security, wage progression, and psychological safety may become as critical to talent retention as compensation alone.

Health concerns also remained elevated across the region. On average, 42% of respondents cited health as a source of anxiety, with the figure rising to 52% in Singapore. Rising healthcare costs were a key factor, with more than half of Singaporean respondents identifying medical expenses as a major national issue. This underscores growing tension between public expectations of accessible healthcare and the financial realities faced by households in both developed and emerging markets.

Mental wellbeing emerges as a form of resilience

Against this backdrop, the study identifies a significant shift towards personal mental wellness as a form of resilience rather than a response to crisis alone. Seven in ten Southeast Asians said they actively worked to better understand their own mental health during 2025, indicating a region-wide move towards normalising mental wellbeing as part of everyday life.

Engagement levels varied by country. Thailand recorded the highest rate at 86%, followed by the Philippines at 82%, Malaysia at 80%, and Vietnam at 76%. Indonesia reported 57%, while Singapore stood at 62%. In addition, 67% of respondents across the region sought out mental health information or education through online resources, courses, or learning materials.

Notably, while only 21% of respondents identified mental health as a top national issue, individual action rates were far higher. This gap suggests that mental wellbeing is increasingly viewed as a personal responsibility and a practical coping mechanism amid prolonged uncertainty, rather than solely a policy or crisis-driven concern.

Sundip Chahal, CEO of Milieu Insight, said the findings reflect a region adapting quickly when institutional support falls short. “Across Southeast Asia, people are under pressure, but they’re not standing still. When support doesn’t land, households adapt fast. We’re seeing mental wellbeing move into the mainstream as a practical way people cope. In 2026, the organisations that respond to these shifts will earn trust, and the ones that don’t risk being left behind.”

As Southeast Asia looks ahead, the study suggests the legacy of 2025 will be shaped not only by economic strain and policy gaps, but also by how individuals adjusted their priorities. How governments, employers, and brands respond to this growing emphasis on mental resilience may play a defining role in public trust and social stability in the years to come.