The number of middle-class households in mainland China has reached 33.2 million as of August 2018, more than half of which are in Beijing (17.54%), Shanghai (17.35%), and Guangdong (15.19%) according to a Hurun report. Ranking by regions, East China retains the highest density with more than 14.84 million middle-house households, accounting for over 40% of the total. Over 10 million out of the 33.2 million households are the new middle-class.
The annual household income of China’s middle class is at least 300 thousand yuan (US$43.5k) in tier-1 cities or 200 thousand yuan (US$29k) in other cities.
Besides the wealth, the new middle-class is also well educated with steady living status, owning at least a house in habitual residence and a work with a competitive salary. China’s new middle-class is less than 30% of the total middle-class. Post-80s become the main force of the new middle-class, and there are post-70s and post-90s. And, they consider themselves as middle-class.
The average age of the new middle-class group is 35. They have a Bachelor’s degree or higher education level and prefer trending topics such as financial investment and TMT (tech/media/telecom). Normally, they have already made it to management positions or become a professional freelancer.
They are no longer satisfied with just a house, car, or consumption capacity; they pay more attention to improve self-cultivation and life quality. They have been developing the habits of reading, working out, and traveling.
Post-80s, being at an average age of 33 and making advances in their careers, care about self-investment. They start to bear the responsibility of taking care of both their parents and children. The aging population comes along with the shortfalls in pension provisions. They try to find a balance between work and family.
Nearly half of new middle-class have more than 20 days of paid leave in addition to the public holidays everyone enjoys. The younger post-90s enjoys the longest length of holidays. In contrast, holidays for those living in new tier-1 cities are 2 days less than others.
Traveling (53%) and workout (40%) are the two most popular entertainment activities among China’s new middle-class.
They do care about physical status and are highly enthusiastic about exercising and working out. That has become a major part of their everyday life. Among them, post-90s are the most active group as over half of them do the workout at least four times a week. However, they do not feel more satisfied with their body figure than post-80s and post-70s.
On average, the new middle-class went on 5 private person-trips in the past two years. Post-90s traveled the most, with 17% of them traveling more than 9 times. In terms of themes, 69% of them chose leisure travel and 37% traveled together with parents or children.
75% of the middle-class feel happy. Wealth status is the most influential factor in the sense of well-being compared with household life and work satisfaction. Though women report being happier than men among this group, the difficulty in balancing work and family is the prime reason for a lower satisfaction, especially among the post-80s who are at the peak earning age.
The new middle-class’s feelings of well-being declines across the age group. Post-70s’ the least happy while post-90s’ the happiest. Furthermore, those living in tier-2 and tier-3 cities are happier than others.
Child care and education (45%), as well as financial management (42%), are the two biggest sources of anxiety among China’s middle-class.
The new middle-class in China also have such kind of worry about falling out of the middle-class if they fail to maintain or appreciate the value of their assets. On average, they have 1.08 million yuan (US$156.61k) investable assets. Their problem is how to manage those assets.
74% of them aim to steadily increase the value of assets and 23% just want to maintain the value of assets. Currently, they mainly rely on traditional financial products supplemented by internet finance. They have low intentions for real estate and P2P leading in order to avoid risks.
This article is an excerpt of CIW eBook “Meet China’s New Middle Class“.