Who's Still Poor? Who's Made It To Middle Income? Pew Has New Data : Goats and Soda The global middle class is growing ... but slowly. (A lot of the credit goes to China.) And more than 70 percent of the world's population still falls below what would be considered "middle" income.
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Who's Still Poor? Who's Made It To Middle Income? Pew Has New Data

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Who's Still Poor? Who's Made It To Middle Income? Pew Has New Data

Who's Still Poor? Who's Made It To Middle Income? Pew Has New Data

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DAVID GREENE, HOST:

Here's some good news. Over the past decade, economic growth has lifted almost a billion people out of extreme poverty. But there are caveats. Few were lifted very far. And as NPR's Jason Beaubien reports, this rising economic tide has been concentrated in just a few regions of the world.

JASON BEAUBIEN, BYLINE: By U.S. standards, most of the world remains terribly poor.

RAKESH KOCHHAR: If we look at the income distribution of the world population, the vast majority is living between two to $4 a day.

BEAUBIEN: Rakesh Kochhar is an economist at the Pew Research Center and one of the authors of a new report called "A Global Middle Class Is More Promise Than Reality." The study looks at changes in economic status around the world between 2001 and 2011. How many people in Burundi, for instance, were considered low income in 2001 versus a decade earlier? How many people in Uruguay rose to the upper middle income category? And while there's been a lot of improvement at the very bottom of the economic ladder recently, Kochhar and his colleagues find that only 13 percent of the world's population is now middle-class.

KOCHHAR: In 2011, 71 percent of the world was either poor, living on less than $2 a day, or low-income, living on two to $10 a day.

BEAUBIEN: For this report, Kochhar defines middle class as income of 10 to $20 per person, per day. By comparison, the median per capita income in the U.S. is $54 per day. Over the course of the decade that Kochhar looked at, the global middle class did expand. Roughly 400 million people reached that middle income threshold. But this prosperity was concentrated primarily in three places. More than half of the newly minted middle class were in China. Most of the rest of them were in Eastern Europe and South America.

KOCHHAR: In Africa, India and some other parts of Asia and in parts of Central America, we see very little growth in the global middle class.

BEAUBIEN: The Pew study maps out a world of extremes. In Europe and North America, most people are upper-middle or high-income, earning more than $20 per day. In Africa and Asia, billions of people are low-income or poor. And there's not a lot in the middle. Heather Boushey, with the Washington Center for Equitable Growth, says the goal of growing the middle class globally is really important.

HEATHER BOUSHEY: The strength of the middle class actually has positive reverberating effects throughout your economy.

BEAUBIEN: There's a positive feedback loop in which people with decent jobs spend more money, which spurs on the economy, which creates more jobs. Boushey says it's also just good for society when people feel economically secure.

BOUSHEY: That gets translated into more social stability, certainly, or a more vibrant democracy or less likelihood of people picking up their pitchforks and getting mad at whatever leader it is that isn't giving them that standard of living that they need to get by.

BEAUBIEN: This new report shows that while the gap between rich and poor nations in the world remains huge, there is at least some movement towards a global middle class. India, for instance, saw the portion of its population classified as middle-income jump from just 1 percent in 2001 to 3 percent a decade later, according to the Pew study. The challenge is that the average person in India is still living on just $3 a day. Jason Beaubien, NPR News.

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