Middle class is burgeoning
(Chinanews.cn)
Updated: 2006-07-12 10:38
A recent survey conducted by the MacKinsey & Company global consulting
firm showed that a large, complicated consumer group is taking shape in China.
Considered as the middle class group in large cities, their consumption power
will redefine China's consumption market.
China's growing economy has enabled millions of Chinese families to shake off
poverty. At present, 77% of Chinese families have made an income less than
25,000 yuan a year. By 2025, however, MacKinsey predicts that only 10% of
Chinese families will make an income even below this figure. By then, urban
Chinese families will be able to consume 20 trillion yuan a year, making China
one of the largest consumption markets in the world.
As the economy continues to grow, MacKinsey predicts that China's middle
class group will experience two developmental stages. Consumption groups whose
income levels have a clear-cut distinction between them will emerge and
disappear in certain periods. In 2010, a large number of lower middle-class
people will emerge in China, whose annual family income will be between
25,000-40,000 yuan. In 2020, a higher middle-class group will spring up, whose
annual family income will range between 40,000-100,000 yuan.
According to MacKinsey's estimation model, by 2011, China will have 290
million lower middle-class people, forming the largest urban social group by
that time, and accounting for 44% of the urban population. The growth of this
group will reach its peak in 2015 when its consumption power will reach 4.8
trillion yuan. The second change will occur ten years later when about tens of
millions of people will become upper middle-class people. There will be 520
million such people by then, comprising over half of the urban population, whose
total dispensable income will reach 13.3 trillion yuan.
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