Written by Marc Adrian
In the Philippines, according to the most recent research done by National Statistical Coordination Board (now known as the Philippine Statistics Authority), only 3 out of 20 households belong to the middle-class population, with two-thirds of them residing in urban areas. 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.
The middle class is basically defined as the socioeconomic group between the affluent and the poor. 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. 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.
Quoting a line from the study conducted by the Philippine Institute of Development Studies (PIDS):
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.
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.
So, which category do you really belong to?
How much do you earn and spend?
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. According to the data from the Philippine Institute for Development Studies (PIDS), the income classes for an average household of five are as follows:
| Income classification | Monthly income |
| Rich | At least ₱219,140 and up |
| High income (but not rich) | Between ₱131,484 to ₱219,140 |
| Upper middle income | Between ₱76,669 to ₱131,484 |
| Middle class | Between ₱43,828 to ₱76,669 |
| Lower middle class | Between ₱21,194 to ₱43,828 |
| Low income (but not poor) | Between ₱9,520 to ₱21,194 |
| Poor | Less than ₱10,957 |
Another 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. 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.
| High income | Middle income | Low income |
| Food | 21.1% | 34.8% | 53.4% |
| Rent/rental value of occupied dwelling units | 16.6% | 13.9% | 10.7% |
| Transportation and communication | 12.5% | 9.8% | 5.3% |
| Fuel, light and water | 5.6% | 7.7% | 7.7% |
| Taxes | 5.4% | 2.4% | 0.5% |
| Education | 3.7% | 5.9% | 2.1% |
| Personal care and effects | 3.0% | 3.6% | 3.9% |
| Others | 32.1% | 21.9% | 16.4% |
| Total | 100.0% | 100.0% | 100.0% |
According 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.
Do note that these data can only be used as a baseline for the classification as it only represents a family of three. Assets and properties are also not taken into account in the earlier study gathered by Philippine Statistics Authority. The expenditure figures, however, may vary from one region to another, as the cost of living in the Philippines differs greatly per region. The cost of living in Davao may not be as high as the cost of living in Manila or Cebu.
So, are you in the middle class?
Based on the data from different sources above, for a family to be considered as part of the middle class, they must meet the following criteria:
- A household income of approximately ₱43,828 to ₱76,669 per month. The bigger your family size is, the higher your income should be in order to fit into this classification.
- If you’re single, and your income immediately falls in the range mentioned above, it’s safe to say that you belong in the middle class, as long as you can freely choose your lifestyle without compromising your daily essentials such as food, transportation, shelter, and etc.
- Overall household and moving expenses on average is 66.2% of your monthly income, the lesser the better.
- Approximately 21.9% of your income can be considered as your discretionary fund which you can spend on luxury items, vacation, non-essential goods, and services, or investment and savings. In other words, it’s extra money you can pocket after paying your bills and spend on all your necessities.
Pitfalls of the middle class
It cannot be denied that the biggest threat to the middle class is economic stability. While everyone in the population gets affected eventually with its rise and fall, the middle class on the other hand is the first in line to experience its strain.
Job creation
Primarily, the middle class is dependent on salary as their main source of income. This means that the bulk of the middle-class population is working class; this is true not just to the Philippines, but even on a global scope.
When a country lacks good-paying jobs, it will create instability to its middle-class population. This explains why America experienced a decline in its middle-class population during the recession in the early 2000s. On the contrary, the Philippines saw a rise when the Business Process Outsourcing (BPO) sector in the country was born.
Inflation
While inflation affects everyone in the population, to the middle class, it has a much bigger implication. For them, it can spell the difference between poverty and financial stability.
When the cost of living or taxes increases they feel the brunt of it. If inflation isn’t countered by the government with mitigating measures or at least couple it with efficient financial aid, the middle class will be financially squeezed. In turn, it will push back most of the population from the lower end of the socioeconomic spectrum beyond the poverty line.
Inflation without any economic intervention is basically how you pull down the middle-class sector of a country.
Social safety nets
Efforts of the government to provide financial aid to the people are channeled through agencies such as Philhealth, Pag-IBIG, and SSS. The benefits that these agencies provide offer major financial assistance to the middle class mainly because it’s mostly this sector that’s actively funding these programs.
For one, Pag-IBIG is the most accessible means for the poor and middle class to purchase a home. Compared to banks, Pag-IBIG is highly inclusive of all socioeconomic classes, even to the poor.
If financial assistance from the government becomes inefficient, it’s the spending capability of the middle class that will mostly be hampered.
The middle class and the economy
Setting the middle class apart from the extreme ends of the social spectrum can sometimes cause misconceptions. That’s why oftentimes, the (upper) middle class is easily associated with the rich while lower-middle-class individuals mistook themselves as poor. However, as definite as to how we see what “rich” should look like, the middle class can be unclear simply because it’s greatly dependent on the economy.
While the poor population also has a more constricted spending capability, the middle-class income and spending power can easily get pushed back beyond the poverty line (for those who belong to the lower end of the middle-income spectrum) depending on the economy.
According to Michael Ettlinger of AmericanProgress.org, a strong middle class is a key to getting our economy moving. Why? Simply because the majority of the spending consumer belongs to the middle-class population. They can be a definite measure of a country’s economic performance. The middle class not only gives the country a face, it will also most likely define what it means to be a regular citizen of that land.
This article was first published in August 2017 and has been updated for freshness, accuracy, and comprehensiveness. However, the figures shown in this article are for reference only as the latest data on the middle class in Philippines is not available at the moment.
FAQs
The Philippine Institute for Development Studies (PIDS) defines the Filipino middle class as households with per capita incomes within two and twelve times the official poverty line.
Who are the people that belongs to middle class? ›
Different income barometers describe the middle class as having income from $50,000 to $150,000 or, in some instances, $42,000 to $125,000. Other measures of middle class set the upper-income mark at $250,000.
Who are the middle class in the Philippines in 19th century? ›
Middle Class – the people that belongs into this class includes the natives, mestizos and the criollos. →The Mestizos are the Filipinos of mixed indigenous Filipino or European or Chinese ancestry.
Is the Philippines a middle class country? ›
The Philippines has been classified as a lower middle-income country ever since the World Bank came up with its classification scheme – whether internally in the early 1980s or as officially published since 1989.
How much of the Filipinos are middle class? ›
27, 2022). The Filipino middle class is about 44% of the population in this consumption-driven economy that looks to the services sector manned mainly by the middle class.
Who were the middle class what did they believe? ›
People of Middle class were educated and believed that no privilege should be given by birth, rather position of a person in society should be merit based. Philosophers, such as John Locke and Jean Jacques Rousseau were envisaging a society based on freedom, equal laws and opportunity for all. Was this answer helpful?
How do you know if you are middle class in the Philippines? ›
A household income of approximately ₱43,828 to ₱76,669 per month. The bigger your family size is, the higher your income should be in order to fit into this classification.
Who are the middle class and what values do they hold? ›
The term middle-class values is used by various writers and politicians to include such qualities as hard work, self-discipline, thrift, honesty, aspiration and ambition. Thus, people in lower or upper classes can also possess middle-class values, they are not exclusive to people who are actually middle-class.
What is the middle class also called? ›
middle class. noun. Also called: bourgeoisie a social stratum that is not clearly defined but is positioned between the lower and upper classes. It consists of businessmen, professional people, etc, along with their families, and is marked by bourgeois valuesCompare lower class, upper class, working class.
Who were the new middle class? ›
New middle class was formed due to European educational system and with the contact of foreign culture- lawyers, teachers, common man, traders etc. were included in the new middle class.
Median age is the age that divides a population into two numerically equally sized groups; that is, half the people are younger than this age and half are older. It is a single index that summarizes the age distribution of a population. Philippines's median age is 25.7 against a global value of 30.3 years.
Is the Philippines middle class growing? ›
Driven by high growth rates and the expansion of jobs outside agriculture, poverty fell by two-thirds—from 49.2 percent in 1985 to 16.7 percent in 2018. By 2018, the middle class had expanded to nearly 12 million people and the economically secure population had risen to 44 million.
What are the social classes in the Philippines today? ›
Three primary social classes exist in the Philippines: the low-income class, the middle-income class, and the high-income class.
What is upper middle class in Philippines? ›
An upper-middle-income country has a GNI per capita of between $4,256-13,205.
Who has the biggest middle class? ›
China, India and the U.S. are projected to retain the top three rankings as the countries with the largest middle-class populations, according to World Data Lab. Slow or negative population growth in some advanced economies will lead to a shrinking middle class in countries like Japan, Germany, Italy and Poland.
What was the middle class explain? ›
The middle class or middle classes are the people in a society who are not working class or upper class. Business people, managers, doctors, lawyers, and teachers are usually regarded as middle class.
Why is the middle class so important? ›
Societies with a strong middle class have lower crime rates, they enjoy higher levels of trust and life satisfaction, as well as greater political stability and good governance.
Who were middle class people and what were their demands? ›
The middle class demanded to the break-up of the feudal system with eliminating privilege for nobles and clerics. The middle-class introduced Liberty, Equality, and Fraternity, as they influenced by enlightenment intellectuals ideas.
How do you know if youre middle class? ›
There is no official financial standard for what constitutes middle class. For most it's more about a standard of living—including owning a home, being able to afford to pay for a college education for your kids, and having enough disposable income to take a family vacation.
What is an example of middle class? ›
The middle class or middle classes are the people in a society who are not working class or upper class. Business people, managers, doctors, lawyers, and teachers are usually regarded as middle class.
The middle class may be said to include the middle and upper levels of clerical workers, those engaged in technical and professional occupations, supervisors and managers, and such self-employed workers as small-scale shopkeepers, businesspersons, and farmers.
Who were the middle class what do you think were the reasons for the emergence of the middle class? ›
The 18th century witnessed the emergence of social groups, termed the middle class, who earned their wealth through an expanding overseas trade and form the manufacture of goods such as woollen and silk textiles that were either exported or bought by the richer members of society.
Why is it called the middle class? ›
The middle class refers to a class of people in the middle of a social hierarchy, often defined by occupation, income, education, or social status. The term has historically been associated with modernity, capitalism and political debate.
What is middle class 2022? ›
As of 2022, Pew identified a middle-income household as anywhere between $30,000 (for a single adult) to $67,000 (for a household of five).
Why is the middle class so named? ›
The middle class was so named because their economic and social position was between the upper class and the working class. Since they were in the middle, they were called the middle class.
How many types of middle class are there? ›
Based on these parameters there are actually five middle classes in India: Rural Middle Class, Public Sector Middle Class, Urban Private Sector Middle Class, Trader Middle Class and Rising Middle Class.
What happened to the middle class? ›
End note. The middle class, once the economic stratum of a clear majority of American adults, has steadily contracted in the past five decades. The share of adults who live in middle-class households fell from 61% in 1971 to 50% in 2021, according to a new Pew Research Center analysis of government data.
How did the middle class start? ›
A post-war rise in unionism, the passage of the GI Bill, a housing program, and other progressive actions led to a doubling of the median family income in only 30 years, creating a middle class that included nearly 60 percent of Americans by the late 1970s.
Who are the early people in the Philippines? ›
Negrito groups were the first inhabitants to settle in the prehistoric Philippines. By around 3000 BC, seafaring Austronesians, who form the majority of the current population, migrated southward from Taiwan.
Who are the first people in the Philippines? ›
The early inhabitants of the Philippines were Mongoloid descent which are predominant today. The gradual spread of Islam from Borneo into the central and northern islands was interrupted by the arrival of the Spanish Christians.
The small-bodied hominin, named hom*o luzonensis, lived on the island of Luzon at least 50,000 to 67,000 years ago. The hominin—identified from a total of seven teeth and six small bones—hosts a patchwork of ancient and more advanced features.
Where is middle class growing the most? ›
Since 2003, when the number of poor and vulnerable people in the world reached a historic peak of 4.4 billion people, the middle class has been growing fast, especially in Asia. By 2030, another 700 million people are expected to join the global middle class, making it more than half of the world's total population.
Why is the middle class declining? ›
“Broad societal changes and technology and the decline of unions and the role of globalization — all these things have fit into what we observe as the shrinking of the middle class and the shift of income to upper-income households.”
Is the Philippines in a middle-income trap? ›
The Philippines has been a lower-middle-income country for two decades since its entry into the bracket in 1996. Despite enjoying a steady growth rate, the Philippine economy is yet to break through the upper-middle-income bracket and is described to be stuck in the so-called Middle-Income Trap.
What makes an individual or group of people belong to upper middle or lower class? ›
Most sociologists define social class as a grouping based on similar social factors like wealth, income, education, and occupation. These factors affect how much power and prestige a person has. Social stratification reflects an unequal distribution of resources.
What is the lowest social class in the Philippines? ›
The alipin refers to the lowest social class among the various cultures of the Philippines before the arrival of the Spanish in the 16th and 17th centuries. In the Visayan languages, the equivalent social classes were known as the oripun, uripon, or ulipon.
What were the social classes in early Filipino society? ›
The classes were divided into four: Maginoo (Noble Class), Timawa (freeman or commoner), Maharlika (warrior), and Alipin (servant). The Maginoo are the royal blooded such as the Datu, which is the leader of the barangay consisting of 100-500 persons.
What are the 3 main social classes in the Philippines? ›
Three primary social classes exist in the Philippines: the low-income class, the middle-income class, and the high-income class.
What are the middle class jobs in Philippines? ›
According to the PIDS, about a quarter of middle-income persons work in wholesale and retail trade, working as vegetable vendors or sari-sari store owners, while nearly a fifth work in transport usually as tricycle and jeepney drivers or bus conductors.
What are the 5 social classes in the Philippines? ›
This conflict can still be seen in today's social classes in the Philippines, Rich, Upper middle, Middle, Lower middle, and Poor which is based on their monthly income.
Pew Research defines middle-income Americans as those whose annual household income is two-thirds to double the national median (adjusted for local cost of living and household size).
What is the middle class? ›
The Pew Research Center defines the middle class as households that earn between two-thirds and double the median U.S. household income, which was $65,000 in 2021, according to the U.S. Census Bureau. 21 Using Pew's yardstick, middle income is made up of people who make between $43,350 and $130,000.
What are the social classes of today? ›
More complex models propose as many as a dozen class levels, including levels such as high upper class, upper class, upper middle class, middle class, lower middle class, lower class and lower lower middle class. while others disagree with the American construct of social class completely.
What are the three social classes and who made up each class? ›
Today, concepts of social class often assume three general economic categories: a very wealthy and powerful upper class that owns and controls the means of production; a middle class of professional workers, small business owners and low-level managers; and a lower class, who rely on low-paying jobs for their ...
