Conjuring a rabbit from a hat, why the middle – class needs attention pronto
In the current context as the Indian economy slowly opens and work resumes in most industrial sectors provided the guidelines as issues by the government are adhered to.
The crowd – intensive sectors such as tourism & hospitality, entertainment, small scale businesses such as individually owned restaurants, salons etc are still awaiting instructions and it is possible that they may see a slower pace of operations as social distancing and precautions are paramount.
While we witnessed the mayhem and the suffering of the migrant population clamouring to go back to their homes and not wanting to be a part of the urban landscape anymore, there is yet another set of population that would soon require attention.
The Indian Middle – Class categorised as lower, middle and the elite upper class may find themselves losing sleep in times to come.
Firstly, lets understand what constitutes the middle class?
It largely comprises of well-educated people employed as teachers, managers or professionals employed in various organizations in different capacities across industries. In other words, it is the salaried employees, this group is now anticipating financial stress owing to job losses, salary cuts and the likes.
With reports coming in of people arriving from the gulf back to the country owing to the above concerns has already made news.
Why is the middle- class important?
Let us discuss major features of middle class in India.
India has 1.3 Billion people and the middle class comprises 45% of the population. The middle class is divided into lower and higher. While the lower middle-class family may have an income of less that 25k per month the upper middle-class income could be in the bracket of 50k to 150k per month.
In a developing economy such as ours, salaried employees having a reasonable amount of discretionary income, where people do not live from hand-to-mouth as the poor do, and where people have roughly a third of their income left for optional spending after paying for basic food and shelter is an important growth factor. This allows people to buy consumer goods, improve their health care, and provide for their children’s education.
The emergence of the middle- class with increasing disposable income forms the most vital consumer market for the private sector. The growth of the middle – class was expected to play a pivotal role in bringing about a constructive change in the Indian economy, creating an environment favourable for private entrepreneurship and job creation.
In the political landscape of India, the rise of the middle – class was viewed as a force for positive change and wellbeing and a moving away from the frustration caused by corruption that has characterised Indian politics for decades.
However, there is a grim picture that is slowly but surely emerging and worries about financial stability, the middle – class may soon find itself addressing valid concerns. Many have home loans, car loans, insurance premiums, personal investments, medical expenses of families or even themselves. Personal and family costs of daily living by way of rentals, education expenses etc and while one might think that entertainment and luxury costs may have reduced there is an increase in household expenses as prices of vegetables and other commodities rise. With schools closed children are now enrolled in online classes and child centric activities like playing outside curbed has already deepened the addiction of online games and online content even as electricity costs go up.
The middle – class may find itself catatonically dipping towards instability and apprehensions about job security and/or salary cuts could be on the rise and may destabilise the very efforts and the positive effect it had on the Indian economy.
