Assets and properties are also not taken into account in the earlier study gathered by Philippine Statistics Authority. Rent/rental value of occupied dwelling unitsĪccording to the breakdown of family expenditure on average, the middle-income earners spend 34% of their income on food, 13.9% on home/rent, 9.8% on transportation, 7.7% on utilities, 5.9% on education, and 21.9% on others which can include savings, recreation expenses, and the likes.ĭo note that these data can only be used as a baseline for the classification as it only represents a family of three. For this one, we will be gleaning from the earlier Philippine Statistics Authority data where the classifications are grouped into three segments: the high income, middle income, and low-income groups, each representing the respective socio-economic classes. That’s a ₱5,748 increase, a 15 percent bump in a span of two years.Īnother indicator that would factor in as a determinant of the socio-economic classification is the family expenditure – the ratio of the overall household expenses to the monthly income. In 2020, the figure has changed and it went up to ₱43,828 a month.

In 2018 Pinoys need to earn ₱38,080 a month be categorically considered as part of the middle class. This benchmark increases as the economy and inflation go up. According to the data from the Philippine Institute for Development Studies (PIDS), the income classes for an average household of five are as follows:

Primarily, the overall household income is a determinant of an individual’s socioeconomic standing, especially in the Philippines where this classification is mostly associated with finances. So, which category do you really belong to? How much do you earn and spend? While defining who is rich and who isn’t can be straightforward to the laymen, defining who lingers in between these two contrasting classifications isn’t as easy. Just as there is no universally accepted definition of poverty and correspondingly setting of poverty lines (Jolliffe and Prydz 2016), there is also no standard definition for the middle class. Quoting a line from the study conducted by the Philippine Institute of Development Studies (PIDS): In economics, this socioeconomic class is a crucial benchmark of a country’s economic standing, thus it is crucial for every country to have a wider base of the middle class than other classes. In a more financially focused definition, the middle class is made up of those people who have the ability to choose their lifestyle, because they have just enough resources to do so without compromising their basic needs. The middle class is basically defined as the socioeconomic group between the affluent and the poor. The middle class plays within the gap between the poor and the rich, and based on these numbers, that line seems to be a lot thinner than what many of us perceived. In the Philippines, according to the most recent research done by the PSA (Philippine Statistics Authority – formerly known as Bureau of the Census and Statistics ), only 3 out of 20 households belong to the middle-class population, with 3 out of 5 of them residing in urban areas.

Middle class definition