Black middle class has expanded quickly but may now slow – new IRR report

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THANDI XABA

The South African Institute of Race Relations (IRR) issued a report revealing that at most 1 in 10 South Africans live a middle class standard of living. Despite the small size of this middle class there has been considerable growth in the black middle class.

The IRR report is based on the size, growth, and likely future expansion of South Africa’s middle class.

Research analyst at IRR Gabriela Mackay says to see these figures increasing, more qualified people should enter the work place and there should be more policies implemented that would encourage economic growth.

"We have seen a lot of growth and have seen a lot of good done, especially with government using the civil service as an incubator to grow the middle black class.

What we definitely need to see happening is to see policy that encourages GDP growth, that encourages entrepreneurship and investment, that will grow. But if we fail to do these things, what we’ll see possibly is the black middle class stagnant and possible shrink," she say.

However, the IRR warned that as the first generation middle class the black middle class was very vulnerable to losing their status as a result of developments such as a sharp economic downturn or a period of rapidly rising interest rates.

The report relied in indicators ranging from household spending levels, to workplace seniority, property ownership and banking patterns.

The IRR’s CEO, Dr. Frans Cronjé, said that, "creating a policy environment in which any child born in South Africa might realistically aspire to reach middle class standard of living should be the single most important priority for a South African government.

The apartheid era government denied such aspirations to a majority of the country’s people. The post-1994 government has done better but too many areas of policy still undermine the educational outcomes, entrepreneurship, and investment driven growth that is so important to unlocking access to the middle classes.

That a child might aspire to a middle class standard of living should be seen as moral as well as a social, economic, and political imperative. There is no doubt that under the government’s current policy framework this imperative is not being met".