Global middle class shrinks for first time since 1990s

A study by the Pew Research Center found the global middle class shrank by 90 million people last year due to the COVID-19 pandemic, swelling the number of poor by 131 million.

The global middle class shrank for the first time in decades last year because of the Covid-19 pandemic, with almost two-thirds of households in developing economies reporting they suffered a loss in income, according to two new estimates based on World Bank data. In a study published Thursday, researchers at the non-partisan Pew Research Center found that the ranks of the global middle class – those earning $10-$50 per day – fell by 90 million people to almost 2.5 billion last year. That helped swell the ranks of the poor, or those living on less than $2 a day, by 131 million, Pew estimated. The Pew data on the middle class actually understates the impact because an estimated 62 million high-income people, or those earning $50 or more per day, dropped into the middle tier as a result of the pandemic, said Rakesh Kochhar, the study’s author.