The COVID-19 pandemic has rewound the clock on a decade-long progressive trend of people around the world moving out of poverty and into the middle class. At the end of 2020, there were an estimated 54 million fewer people in the middle class than had been projected at the start of the year, and 131 million more in poverty.
Those figures are based on analysis by the Pew Research Center conducted in March. To complement that research, the nonpartisan think tank this week published an interactive income calculator that anyone can use to determine where they fit into Pew’s five defined global wealth categories.
Pew assesses that in 2020, 17% of the global population was categorized as middle class (living on $10 to $20 per day); 51% as low income ($2.01 to $10), and 10% as poor (less than $2); 15% as upper-middle ($20.01 to $50), and 7% as high income (more than $50 per day). Using the calculator lets you see where you land. Just select your country and input your income.
The calculator was designed as “a companion to our research on the size and well-being of the global middle class,” says Rakesh Kochhar, the senior researcher. Kochhar says it can be useful for people to “find themselves in the numbers,” a more intuitive way than simply reading the research to comprehend where they stand, economically, compared to others around the world.
Those distributions demonstrate a shift from the predicted ones, and a reverse in the trend of the previous decade. From 2011 to 2019, Pew tracked strong growth in the size of the global middle class, which swelled by 436 million people (largely driven by China, Kochhar says), and a steady movement out of poverty (what the World Bank labels “extreme poverty”) by 390 million people. However, Kochar says “the pandemic has slipped back progress on these fronts by several years.” And that was driven by specific geographic locations. The majority of the 131 million more people ending up in poverty were in South Asia—especially India—and sub-Saharan Africa; and the 54 million fewer in the middle class were largely in South and East Asia.
The global middle class is an especially important tier to use as a measure of progress, because upward movement into that category represents a step up the ladder for poor or low-income people. “It’s the aspirational aspect of it that tends to make us focus on the middle class,” Kochhar says, noting that in the U.S., the idea of the American Dream has long been culturally linked to the middle class.
Economically, it also reflects the state of inequality in the world: a larger middle class, Kochhar says, reflects a more shared experience in standards of living; a smaller middle class reflects a larger wealth gap, with a high share of people living below the middle class, and a high share above the middle class in “advanced economies.” In fact, among advanced economies, the numbers shift dramatically: at the end of 2020, 39.8% were estimated to be in the high-income category, 47.9% in upper-middle income; and 9.4% in middle income. The lowest two tiers barely registered.
Of course, in the U.S. more people than 9.4% would describe themselves as being middle class. But because it’s a world scale, the researchers have to find a global consensus so that it’s a more accurate reflection of the entire world, where incomes range from $0 a day per capita, to hundreds. “Most of the world would end up being poor by American standards,” Kochhar says. It’s a hard task, but Pew’s system sets earnings of $10.01 per day as a threshold for the middle class—at which point it believes the risk of falling back into poverty is significantly reduced. “It’s heuristic,” Kochhar says. “It’s not a physical science.”
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