SA middle class needs to increase by 30% to sustain economic growth

South Africa’s middle-class is slowly becoming poorer as it continues to be squeezed by taxes, rising food prices, increasing debt, higher interest rates and security costs.

Speaking to The Citizen, social anthropology expert, professor Leslie Bank said that the country’s current middle-class is too small and needs to increase by “at least 20% to 30%” if economic growth is to become sustainable.

This is in light of the group’s significant increase since 1994, with 55% of all middle-class South Africans now black, said Bank.

These concerns were echoed by Stellenbosch University’s Servaas van der Berg, who noted that, in addition to the rising cost of taxes, many of the purchases considered “essential” by middle-class South Africans were becoming unaffordable.

According to van der Berg, this includes the cost of ensuring that there is adequate security and internet connectivity within their homes.

“Some of the things the middle class regard as so important have become quite expensive.”

“The costs of things such as cellphones and computers and Wi-Fi have become very important for many people in the middle class, and they put additional strains on their finances,” he said.

Van der Berg warned against credit-binging and dangerously high levels of debt among the country’s middle class.

“Due to the absence of adequate policing, many within the middle class incur security costs, all to be added to the costs of school fees and private medical insurance, to which increasing numbers of the black middle class subscribe,” said Bank.

In comparison, Bank believes that the white middle-class – while remaining fairly static – is struggling to retain jobs, leading to increased financial pressure.

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