Bad days are here for Indian middle class as per the income survey data of CMIE (Centre for Monitoring Indian Economy), the hit on incomes during the lockdown is felt across the income spectrum.
In their survey, CMIE asked “Did your income increased compared to last year?” as we all know that most of the private or public sector employees get their increment between Apr-Jun every year but this year in the month of April 2020 only 9.6 per cent household has confirmed an increase in their income. In the month of May 2020, only 6.1 per cent household said that their income has grown over last year which means an income of almost 94 per cent household in-country is static or declined during May’20. During June 2020 it has further declined to only 4.4 per cent of household confirming an increase in income. As we all know our income must increase every time to match or beat the inflation as inflations increase’s every year. If our income remains static and inflation increases this will be called a decline in ‘real income’.
During Qtr-1 FY 20, 33 per cent households in the survey confirmed an increase in their income which itself was not a good number as inflations impacts every household in the country and if only 33 per cent households got an increase in income the remaining 67 per cent households has to manage their livelihood with the same income or declined real income.
The worst-hit are middle class and upper-middle-class of the country.
In Apr-Jun 2019 about 50 per cent of the households that earn Rs 5 lakhs per annum reported a year-on-year increase in household income whereas, in Apr-Jun 2020 less than 15 per cent, such middle-class households got similar income increase which means about 85 per cent middle-class households have static or low income during Apr-Jun 2020. During Apr-Jun 2019, 60 per cent households with Rs 10 Lakhs annual income reported an increase in income but in Apr-Jun 2020 Rs 10 Lakhs per annum income households groups income dramatically dropped to 0 per cent increase in income. This is an alarming sign for Indian middle-class households.
33 per cent of the households that earn between Rs 24 Lakhs to Rs 36 lakhs per annum reported an increase in income during Apr-Jun 2020 but it is to be noted that a year ago, over 70 per cent of such households had registered an increase in income.
This data clearly shows that most of the middle-class households of the country have either lost the job or had a pay-cut or loss incurred in business due to lockdown. Here, it is important to understand that these middle-class households are the real consumers of the consumer durables, automobiles and properties which means a drop in their income will lead to low demand of all these products which will have a direct impact on GDP of the country.
The most important thing, Indian middle class need to understand that, Govt is only focused about the poor’s by providing them relief package of free ration, work in MNREGA, direct cash transfer and PM Kisan Youjna like welfare schemes but there is no relief for the middle class, no means no relief because Govt believes that the mood of this section of Indian society has been driven by the “Godi Media” narrative. These middle-class section is happily enjoying the ‘Hindu-Muslim’ debates on TV channels and they never raise questions on job cuts, derailed economy, defective health, education & financial system of the country.
This is the wake up call for Indian middle class as now they have to ask the questions to the government.
