China's Middle Class Comes With New Characteristics

Recent report looks beyond numbers to define an evolving social stratum.

By Lin Qiqing

There’s now an alternative answer to the question of what constitutes “middle class” in China.

The country’s emerging middle class is urban, well-educated, born in the 1980s, and — most importantly — living an indulgent, modern lifestyle, according to a report published Monday on Channel Wu, a WeMedia account run by financial writer Wu Xiaobo that arrived at this definition after surveying more than 20,000 people.

Individuals with an annual income of 100,000 yuan to 500,000 yuan ($15,000 to $74,000) are classified as middle class, according to the report. A majority of this demographic also hold university degrees, live in large cities, and have disposable income. In fact, “Income left over after living expenses have been deducted is the best indicator a ‘middle-class’ family,” the report read.

Even though the world’s second-largest economy is growing toward a middle-class society, many who are classified in this social stratum based on their income alone remain divided. While the Chinese government’s definition of individual middle-class income ranges from 60,000 to 500,000 yuan per year, consulting firm McKinsey & Company uses a narrower range of 75,000 to 280,000 yuan.

However, the new report backs away from the traditional approach of using only numbers as a yardstick for measuring the middle class. According to the survey, the new middle class is also increasingly valuing experiences over expensive commodities, with most respondents showing a predilection for experiences such as learning, traveling, socializing, and entertainment.

The survey also takes into account families, whose definition of middle class is more dependent on health care and lifestyle choices. For example, families with members of similar ages, educational backgrounds, and incomes that identified as middle class had an additional set of criteria that included traveling overseas, owning air purifiers, playing sports, and paying extra for housing and private medical care.

At the same time, skyrocketing housing prices in big cities — notably Beijing, Shanghai, and Guangzhou — are also driving some young middle-class individuals to work or settle down in smaller, quieter places.

The Economist Intelligence Unit estimates that many of China’s smaller cities will see “sizable leaps” in consumers spending, adding that 35 percent of the country’s population may well fit the definition of “upper-middle-income” and “high-income” by 2030, and have an average disposable income of 67,000 yuan.

Editor: Bibek Bhandari.

(Header image: A young woman drinks a glass of wine while looking out the window of her apartment in Hangzhou, Zhejiang province, June 13, 2015. Chen Ronghui/Sixth Tone)

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