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THE lack
of middle-income family-friendly development policies
may be the reason why the number of the Philippine
middle class and their incomes have been decreasing,
according to the National Statistical Coordination Board
(NSCB).
In his
column titled “Antipoverty? How about Pro-Middle Class?”
NSCB secretary-general Dr. Romulo Virola said the
percentage share of the middle- and high-income classes
declined between 1997 and 2000 and between 2000 and
2003.
Virola
said that this resulted in an expanding low-income class
in Philippine society.
As of
2003, Virola said less than 1 in 100 families belonged
to the high-income class and about 20 are part of the
middle income and 80 are in the low-income group.
Virola
said that in a span of six years from 1997 to 2003, for
every 100 middle-income families, three families have
been lost to the low-income category.
“Generally, it is believed that, for a country to be
truly and sustainably prosperous, there must be a
broad-based middle-class that serves as a stabilizing
influence on society. A middle-class that has the
knowledge, the skills and the resources to foster
economic growth is needed help generate employment for
the poor. But so far, the poverty-reduction programs we
have crafted have focused mainly on being “propoor,”
“antipoverty,” helping the “poorest provinces,” etc. We
seem to have completely ignored the needs of and the
strategic importance of building and expanding the
middle class of Philippine society,” Virola said in his
column.
“While
we all agree to want to help the poorest of the poor, a
strategy that pays attention to the middle class may be
more effective in achieving our Millennium Development
Goal (MDG) to halve poverty by 2015,” he added.
Virola
said the middle-income class are those families who, in
2007, have a total annual income ranging from P251,283
to P2,045,280. Middle-income families also have houses
built of strong materials and own a house and lot, a
refrigerator and a radio.
While
the general population spent the most in food at 46.58
percent; housing and repairs, 16.8 percent;
transportation and communications, 7.52 percent; fuel,
light and water, 6.95 percent; and education, 3.83
percent, the expenditure items with the least shares are
recreation with 0.38 percent; other miscellaneous items,
1.04 percent; tobacco, 1.19 percent; household
operations, 1.23 percent; and household furnishing and
equipment, 1.76 percent.
“Indeed,
it is a challenge to our development planners to do
something about and for the middle class. We can no
longer ignore the seemingly systematic shrinking of the
group of professionals and skilled workers who can
spell the difference between us being mired in poverty
or crossing over to the league of First-World countries
by 2020,” Virola said.
Virola
said the middle-income class does not favor a lifestyle
of conspicuous consumption. Its top expenditure items
are food; house rent; transportation and communications;
fuel, light, and water; and education while the least
shares of expenditures went to nondurable furnishings;
alcoholic beverages; tobacco; recreation; and house
maintenance and minor repairs.
Meanwhile, preliminary results of the 2006 FIES seem to
indicate a continuation of the pattern. The good news is
that the ratio of the income of the richest 30 percent
to that of the poorest 30 percent and the ratio of the
income of the richest 10 percent to that of the poorest
10 percent has gone down.
Further,
the Gini coefficient has improved to 0.4564 in 2006 from
0.4605 in 2003, which Virola said indicated an income
distribution that is getting slightly more equitable.
“The bad
news is that the income share of the families in the
fifth to the seventh deciles has gone down, meaning that
the income share of some of the middle-class families
has shrunk,” he said.
While
the middle-income class expanded in emerging countries
like China and India, Virola said the general trend is a
shrinking middle class which the Philippines share with
many other countries. |
