Global poverty levels are on the decline, but that doesn’t mean a worldwide middle class is emerging.
Only an estimated 13% of the world’s population enjoys an existence that can be described as “middle class,” according to the Pew Research Center.
Analysts from the center crunched numbers from the World Bank PovcalNet database and the Luxembourg Income Study to arrive at their findings related to global income levels between 2001 and 2011.
The data uncovered revealed that worldwide poverty levels during the period did plummet, but not by enough to bolster a large, international middle class.
The study focused on 111 countries that accounted for about 88% of the global population and roughly 85% of world output in the 2011.
Defining the Middle Class
Researchers did not use Western standards to define the middle class for purposes of the study. Instead, people described as living in the middle income range technically survive on about $10 to $20 a day, which adds up to an annual income of $14,600 to about $29,200 for a family of four.
The official poverty line in the United States for a family of four in 2011 was $23.021. In 2011, researchers found that 13% of the world’s population fell into the middle income category, or roughly $10 to $20 a day.
Only about 16% of the world’s population lived on $20 or more daily. On a global scale, that $20 number actually adds up to an “upper-middle or high-income” existence, researchers found.
The majority of those who netted this type of income were found in economically advanced countries in the Asia-Pacific region, Europe and North America. The noted rise in overall prosperity came from such regions as Eastern Europe, South America and China.
Income Growth by the Numbers
The comparison of income levels through the years the study focused on are telling. The percentage of the global population by income breaks down as follows:
- Poor – 29% in 2011 versus 15% in 2011
- Low income – 50% in 2001 versus 56% in 2011
- Middle income – 7% in 2001 versus 13% in 2011
- Upper-middle income – 7% in 2001 versus 9% in 2011
- High income – 6% in 2001 versus 7% in 2011
Those described as poor live on $2 or less daily while low income earners pull in about $2.01 to $10 a day. Middle income is described as $10.01 to $20 a day and upper-middle income involves about $20.01 to $50 a day. The high income category covers those who live on $50 a day or more.
The Bottom Line
Pew researchers noted marked improvements in the number of people living at the poverty level, but point to a number of factors that stand in the way of the emergence of a global middle class.
One of those factors is the uneven geography of where the emerging middle class is found and the continued clustering of high-income populations in economically advanced populations.
The relatively low percentage of middle-income earners led researchers to say the “emergence of a truly global middle class is still more promise than reality.”
