Over the past few years, the middle class in developing nations in Africa has risen alongside economic growth. They currently account for a significant percentage of global wealth. The African Development Bank indicated that by 2060 there will be at least 1.1 billion middle class Africans.
“The Middle class refers to people spending between $2 and $20 daily based on the average cost of living”
I personally think that the conventional social class system is too simplistic to be applied to Nigeria. This is because there is a high degree of variation in poverty and income inequality levels across the country and this poses a problem in classifying individuals and households into one of the three main categories (lower, middle and upper). However, for the sake of this post and to articulate my points clearly I shall rely on the AfDB’s definition of the “middle class”.
Nigeria’s new middle class emerged out of the spurious growth of private sectors, particularly: banking, telecommunications and service provision. The middle-class constitutes around 30% of Nigeria’s population with a majority residing in Urban areas e.g Lagos and Abuja.
Historically, the middle class has been an indicator of growth. So, to an extent, the situation of the Nigerian middle class is reflective of the country’s economic condition. This is because they influence labour activity and productivity and unfortunately they are most likely the first group to be impacted by negative shocks and downturns.
How do you identify a middle class Nigerian?
- A middle class Nigerian earns salaried income or runs their own business.
- They do not rely on the healthcare system and can afford to seek expensive medical treatment when ill.
- They have a post-secondary education and are keen on ensuring their children get an education at a decent institution at home or abroad.
- They aspire to be homeowners or already are.
- They are geographically concentrated in urban areas.
The present economic situation brought about by the current administration’s inefficiencies has prompted some questions about the existence of the middle class in Nigeria. The harsh economic realities (rising inflation, weak naira, and the decline in global oil prices) have made consumption much difficult for a population that is predominantly consumerist. Based on the current economic fundamentals and prevailing uncertainty in the country a significant percentage of “middle class” households are highly vulnerable to falling back into poverty.
“Africans are mainly rich or poor but not middle class”
The perception that the middle class is not growing is also damaging for trade and investment opportunities in Nigeria. A growing middle class is beneficial because it signals an efficient and functioning market which is always attractive to potential investors.
Nigeria cannot reach its full potential without the middle class. Hence, if these unfavourable economic and social policies are not reversed in the coming years there is a risk that the middle class might become non-existent or account for an extremely small proportion of the population. You will either be rich or poor.
- Inclusive growth has to be prioritized. High growth rates unaccompanied by a reduction in poverty and income inequality is practically useless.
- The Nigerian Government also needs to implement social safety nets for the unstable and vulnerable groups in the society. This would reduce the likelihood of them falling back into poverty during economic hardship.
Thanks for Reading,