Contrary to common perception, the world is taking huge strides in lifting people out of extreme poverty. One in every seven person on the planet now belongs to the global wealth middle class. That’s a whopping 1.1 billion people!
But don’t uncork that expensive bubbly yet.
What’s even more interesting is that just one country now accounts for half of the global wealth middle class. China’s climb up the global wealth ladder has been truly impressive.
In 2000, half of the roughly 500 million people that qualified as global middle class came from Japan, North America and Western Europe. At the end of last year, China alone took this crown, with the share of these industrialized regions shrinking to a quarter, shows the report.
Over the past two decades, around 500 million Chinese people have joined the global wealth middle class and 100 million more are part of the upper class.
“We live in a world of a great paradox,” says Michael Heise, chief economist of Allianz. “When future historians look back at our time they will say that the last 30 years probably saw the most dramatic improvement in living standards in human history. “This should be a moment of celebration in the West as this is the culmination of its great project of improving the human condition. However, the West has probably never been more depressed.”
A reason is the growing inequality being seen in the “old” industrialized regions, particularly Europe and the United States. There, those who toil for a living rather than own the means of production have experienced deteriorating conditions. Labor markets have made a slow and incomplete recovery from the 2008 global financial crisis, which adds to the perception that there is a growing gulf between the rich and the poor.