Though there is no official definition of
"middle class" in China, the tag has become one few Chinese people
believe they deserve anyway.
In early August, the Chinese Academy of Social
Sciences released a report on China's urban development, saying
China had a middle-class population of 230 million in 2009, or 37
percent of its urban residents. It also forecast half of city
dwellers in China would be part of the middle class by 2023.
The conclusion, however, met strong criticism
as most urban residents, no matter how much they earn, said they
were heavily burdened by everyday work and life.
From the great changes in its social structure
onward since the 1980s, China does have an expanding group of
people with high incomes and lifestyles reflecting well-being. They
consist mainly of private entrepreneurs, office workers,
professionals such as lawyers and IT engineers, and freelance
Authors of the report used the Engel's
Coefficient, the ratio of expenditure on food to personal
consumption, as the criterion in their study. In light of the
report's definition, people who spend 30 to 37.3 percent of income
on food should be categorized as middle class.
Standards set by the UN Food and Agriculture
Organization indicate an Engel's Coefficient above 59 percent
represents absolute poverty; 50-59 percent, barely enough food and
clothing; 40-50 percent, a "moderately well-off" standard of
living; 30-40 percent, a "well-to-do" standard of living; and below
30 percent, a "wealthy" life.
But, using the Engel's Coefficient alone in
the classification of people may exaggerate the situation.
Take Beijing, for example. Residents surely
spend less on food. But, their expenses for housing, medical care,
education and many other daily necessities have increased rapidly
since Beijing has already made the list of the world's top 20 most
expensive cities. Especially against rising inflation in recent
years, their purchasing power is shrinking.
It's generally believed an olive-shaped social
structure, with the largest proportion of middle class and small
scale on both ends, is the most stable. In contrast, China's social
structure is really pyramidal. A World Bank report in 2010 said the
top 1 percent of Chinese families owned 41.4 percent of the
To tackle this more serious challenge, the
Chinese Government must speed up efforts to reform the income
distribution system, improve the social safety net and give private
businesses greater market access to more sectors, instead of
focusing on the statistical perspective of the middle class.