For many decades the American consumers have led the pack of global consumptions. However, not for too much longer as China’s economy strengthens. Heavily effect by the rapid expansion of China’s middle class; due to the increased number of high-paying tech jobs in China’s major cities. Coupled with a new generation of shopper emerging. These consumers are starkly different from previous generations of consumers and have different shopping behavioral habits. This new generation sees a value in spending, not afraid to accumulate debit and not as frugal as their parents.
How China Middle Class Grew So Quickly
In comparison of China’s population to the United States population, it was only of matter of time before China would catch up with the United States in terms of consumption. Overall, China is a bigger country, with a bigger population and now a bigger consumer market. Making it extremely easy for them to catch up with the United States when their economy shifted. China repetition as a manufacturing and production hub for the global economy is turning into a technology hub. At the same time changing and evolving into becoming one of the most significant global consumer markets.
China exponential growth of consumptions can be attributed to many factors but, its’ leap into becoming a top player in the global consumption is monumental for the country. As China’s middle class continues to thrive, it shifts the global demand for goods. The increase demand is shifting and rising prices. According to a study from McKinsey & Company, approximately 76% of China’s urban population will be meet middle class salaries by the year 2022. In order to classify as middle-class urban households must earn $9,000-34,000 a year. Although, that may not seem like a significant amount in comparison to U.S. standards, it is relatively on par with the United States standard of 37,000-56,000. An astonishing feat for China since its middle class has growth more than 70% in the last two decades.
Why You China’s Middle Class Is Influential
Just like with any emerging economy, as China’s economy becomes stronger the more Chinese consumers began to make and spend. According to the Boston Consulting Group, the consumption of goods Chinese consumers buy is supposed to grown around 9% each year up and until 2020. Causing the overall global consumer economy to grow by around 55% to around $6.5 trillion. This substantial shift in demand, creating larger of demand for goods bigger the markets of U.K or even Germany.
China’s steadily rise consumer rate increasing approximately 14% annually, can be attributed to many things. Rather the higher paying jobs that have caused a large accumulation of wealth, the change of consumers habits and the influxes of large market of consumers. In fact, China’s demand for goods and consumer market is so big by 2020 China is supposed to make of more than half of all the global e-commerce purchases. Subsequently, changing how the world views ecommerce, social commerce and on selling globally to China, as it becomes a leader in consumption.