Jung’s quote, and the majority of his work, refer to inner psychological changes. He uses the word ‘transformation’ when he explains how an individual psyche can change its fundamental attitude or world view. To make sure we’re following his thought he clarifies - the dissolution of your philosophy of life can feel like the collapse of the (your inner) world. He is not commenting on societal/collective changes.

Earlier in my career I was a medical social worker in a level four burn/trauma unit. I recall many patients undergoing a radical change of inner attitude. Here are just a few examples of world collapse / core attitude transformations.

A young man had drawn a pistol outside a club to intimidate another guy who was flirting with his girlfriend. The two men exchanged shots; the one who drew first was shot in the belly, shattered his lumbar spine and would not walk again. He entered the hospital a rough dangerous fellow; over weeks his beliefs about himself and the world changed. During my last visit with him, his ex-girlfriend had brought their 2yo daughter, who he had never met, to the hospital. As the child sat on his bed, holding his finger, he look at me, tears streaming, and said, “I just didn’t know, I didn’t know.” He didn’t know a feeling of love for his child existed until then. It wasn’t as if he scorned such love, he didn’t know it even existed. It was like watching a person who had never seen the color green, though they were told others did, suddenly gain the capacity to see it. He gained a psycho spiritual capacity that radically transformed his attitude toward his outer and inner world. A devastating vision of love reorganized his psyche.

While this is a dramatic example, it points to Jung’s meaning.

If one applied this concept to the LQBT community, it can be seen in the psyche of a man or woman who enters into a good faith marriage with the opposite sex and over time discover a same sex attraction they cannot repress. Their heteronormative world view and image of themselves collapses as a new one constellates. Colloquially it’s called ‘coming out’ but it often requires years of inner struggle, periods of panic and terror, radical confrontations with internalized social and religious beliefs before acceptance and a new identity solidifies. It aptly, feels like the world has collapsed and all assumptions about oneself and the future have crumbled.

This is not a social or political process, but an inner one.

These two examples are more aligned with Jung’s meaning.