How Much Do Chinese Make? The Answer Depends on Which “Chinese” You’re Looking At

To many who live outside China, Chinese seem to be getting richer in a no-less-than-eye-popping fashion. One doesn’t have to look far to be impressed by Chinese’s wealth and spending power. Almost overnight, fleets of Chinese travelers are seen on shopping sprees in boutique stores and fancy malls overseas for everything from designer handbags, clothing, shoes, perfume to expensive watches and jewelry. The Chinese’s appetite for, mind it, not only cars but luxury cars amazes manufacturers like Rolls-Royce, who finds the country overtaking the US becoming its largest market in 2011. No wonder China has become the world’s largest consumer of luxury goods, according to a report by World Luxury Association in 2012. But that shouldn’t be too surprising since China also has the second most “ultra high net worth individuals”–individuals who have net wealth of 50 millions and more–in the world, only after the US (whose number is seven times of that of China), as Credit Suisse Research’s 2011 Global Wealth Report shows.

But really? Are Chinese really that rich? Yes and no, depending on where you look. Yesterday, the National Bureau of Statistics of China (NBSC) published a report titled “The 2011 Income Growth of Urban and Rural Residents” (Zh), which shows that, despite their high growth rates, average Chinese’s income levels are nowhere near what Americans would consider as “well off.” The report also shows huge income disparity between urban and rural residents.

The report is based on a survey of 66,000 urban and 74,000 rural households in all 31 provinces, autonomous regions and municipalities across China in 2011. According to the report, the average annual income for urban residents in 2011 is 23,979 yuan ($3,786), and the per capita annual disposable income for urban residents is 21,810 yuan ($3,444). After inflation adjustment, the growth in disposable income is 8.4% compared to that in 2010. (Just to give you some sense by comparison, the per capita money income of Americans in 2009 is $27,041, over seven times as much as that of Chinese urban residents. The poverty line for one person household in 48 Continuous States and the DC in the US in 2011 is $10,890 and $3,820 for each additional person.)

This is not the extravagant picture we see depicted in many media. If we look at the figures of the rural residents, we will see even starker contrast. According to the report, the per capita annual net income for Chinese rural residents in 2011 is 6,977 yuan ($1,102), with a growth of 11.4% compared to 2010 after inflation adjustment. That means that a rural Chinese makes only a third of what her/his urban counterpart makes and 4% of what an average American makes.

It needs to be noted that many “rural residents,” whose residential status is determined by their hukou, live and work in the cities as migrant workers. According to the latest statistics available, the number of rural residents working in cities almost reached 150 million in 2009. Officially as “rural residents,” these are industrial workers rather than farmers. These workers’ wages, 2,963 yuan ($468) per capita annually, contribute 42.5% to the total annual income for rural residents, according to the Income Growth report.

Among these migrant workers, about 100 million are a “new generation migrant workers” (新生代农民工), born between 1980 and 1995, as the statistics (Zh) from All China Federation of Trade Unions (ACFTU) show. They make an average of 1,747 yuan ($276) a month, about half of what employees who have the urban status. More than half of these young migrant workers are single, partly because of their low income and the increasingly expensive living in cities (follow-up post coming up soon).

So you get the picture. Chinese are not wealthy, especially rural Chinese and migrant workers, who, ironically, have created perhaps most of the wealth that’s been fueling China’s rise as a world economic power. And as the richest of the rich are busy planning on leaving the country with the wealth they’ve accumulated in China, these farmers and workers are the ones who will stay, and work, and live on this land of wonders and sacrifice.

Jin Zhao


    • Thanks for reading! Well, I don’t think there’s a simple answer to almost any issue or problem about/in China, nor do I think China should be “judged” on one or two things or a couple groups of people. That’s why it’s important for people, in or outside China, to get as complex as possible a picture of the country and its people in order to understand this country whose presence increasingly affects our lives, directly or indirectly. Lately, there’re lots of discussions in the US media about whether China’s wealth will impact on the US economy and a lot of media attention has been paid to Apple’s suppliers’ labor issues, etc. I think we’ll see more and more such topics in the US and other Western media. I hope, while carefully avoiding to claim the ability to provide solutions per se., this post and my blog in general can help shed some light in understanding these issues. Your thoughts?

      • I completely agree with your assertions. However, I fear that for most people (in this case, Americans – and how is that for stereotyping?!), it is easier to maintain the stereotypes that are being created and it will be difficult to break through the assumptions that result. China (and those who live in China) is neither good nor bad but, like the rest of the nations and peoples of the world, complex and difficult to pinpoint as just one thing.

        Along that same line, perhaps Chinese will one day be able to recognise the same thing about America (and the rest of the West).

        • I’m a bit confused what your point is. Judging whether a country or a people is “good” or “bad” is beside the point–pointless, actually. “China,” or any country in world, is not a singular unified entity. It’s never my intention in this blog to show whether “China” is good or bad. I hope I didn’t give you that impression.

      • Sorry, I may have rambled a bit in my response. I was not attempting to state that China is good or bad, nor imply that you were intending to do so. Instead, I was agreeing with your idea that China is complex and people should learn as much as they can. I meant to point out that doing so is difficult because of certain pre-conceptions that people tend to create and maintain and rarely are challenged upon.

        However, it is also important to note that learning of that complexity is difficult but that yours is one of a few sites that help to permit some insight into said idea. However, do you think that it is easier to gain insight into the complex nature of China and its citizens from being there or from not being there but only reading about it through the eyes and ears (and words) of others?

      • Thanks, Chopstik. Sure, living in a culture is a great way to learn about a culture, and better, learning the language. Unfortunately not everyone will be able to do that. Anyways, I I just hope that this blog can be one source of information for people who are interested in China, even though what one blog can do it quite limited.

    • If I understand your question, I do not think that China can be judged on either its rich or poor. The question is what is the best way forward? I personally think that China’s adoption of a super rich is not necessarily a bad thing; it serves a beacon for others to migrate towards, but realistically, a strong middle class seems to me (I could be wrong) to be the best bet for China; she has a lot of people.

      • I guess that’s a pretty popular argument among some neo-liberal economists, but it still bothers me. I think it’s important for Chinese to ask what the goal of economic development is for us. It’s equally important to ask what paths we want to take to achieve that goal. I don’t think it’s okay to sacrifice some citizens (and a great number as well) for some other citizens to prosper. That shouldn’t be the way we build a nation.

  1. I just spent three weeks in China last summer, ~ 1/2 in Hunan 1/2 in Beijing. It was rather confusing. The wealth I saw was huge but localized. Very big houses and very expensive cars, but mostly I saw poor people. China, in my opinion, is in a very unique position of transition. As far as I could see, poverty still largely offsets prosperity, but optimism appeared really high. Kind of reminds me of why poor americans vote republican, as if supporting the rich will eventually make you rich. How long such dreams can continue is the issue. Maybe China can pull this off; if so please let America know also, because american poor stay poor.

  2. Just to make a point. I am American, and I am very happy to see China emerge as a major power now, given that she has been a major power for thousands of years prior. So… welcome back to the club, now lets get down to business. How do we all deal with poverty and maximize human satisfaction? This is not an American, Chinese, European, African, …etc. question. It is simple a question regarding all human beingings (sp? sorry). Bottom line, in no society can a small group of people grab all the money and expect the remainders to be accepting of their fate. This is the source of revolution and should be quenched ASAP. The cultural revolution served primarily to redistribute wealth. I imagine that doing this again is not in any one’s best interest.

  3. Maybe what I said is stupidly obvious. Sorry if that were the case.
    Sincerely, George

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