Monday, October 29, 2018

Standard Chartered Bank: Pakistan Among Most Upwardly Mobile Emerging Nations

Pakistan is among the most upwardly mobile nations in the world, according to a new Standard Chartered Bank study titled "Climbing the Prosperity Ladder".

The Standard Chartered study looks into social mobility, financial proficiency and digital savviness among 11,000 emerging affluent consumers in China, Hong Kong, India, Indonesia, Kenya, Malaysia, Nigeria, Pakistan, Singapore, South Korea and the UAE. 34% of Pakistani respondents said their incomes have increased by more than 50% over the last 5 years while 44% said they have seen 10% or more income growth in the last year.

Socially Mobile Income Growth. Source: Standard Chartered Bank

China, India and Pakistan:

Standard Chartered study talks about the "fast-growing economies of China, India and Pakistan are providing abundant opportunities for scaling the social pyramid".  Here's an excerpt of the Standard Chartered report:

The fast-growing economies of China, India and Pakistan are providing abundant opportunities for scaling the social pyramid. Leading the way, in both China and India 67% of the emerging affluent are experiencing positive social mobility, while Pakistan is not far behind with 64%. Of the emerging affluent in these countries, India and Pakistan both have more than one in 10 (11%) that are experiencing supercharged social mobility, versus 7% in China. Strong earnings progression is fueling impressive rates of social mobility in all three countries. Many of the socially mobile have benefitted from a salary increase of 50% or more in the last five years – 34% in Pakistan, followed by 30% in India and 26% in China. This gap could widen, with India and Pakistan more optimistic about their future salaries than their Chinese counterparts. Almost half of the socially mobile in Pakistan (48%) and India (46%) predict another earnings increase of 50% or more in the next five years, whereas less than three in 10 (29%) expect the same in China. While the emerging affluent in China are more cautious about salary growth than their counterparts in fast-growing Pakistan and India, workplace remuneration is just one side of the social mobility equation. Education has been considered crucial to improving social standing in China for a long time, but the generational shift towards university access among the socially mobile is larger than any other market: more than nine in 10 have attended university (91%), compared to 34% of their fathers and 29% of their mothers.

Education Mobility:

Upwardly mobile Pakistanis have seen a significant increase in education levels. 89% of them have college degrees compared to 66% of fathers and 49% of mothers who did.

Socially Mobile Education Levels. Source: Standard Chartered Bank 

Gender Balance:

In terms of gender parity, 51% of socially supercharged in Pakistan are men and 49% are women.

Socially Mobile Gender Differences. Source: Standard Chartered

Intergenerational Mobility:

Are they better off than their parents? The answer is a resounding Yes for 79% of Pakistanis who feel better off than their parents.

Inter-generational Mobility. Source: Standard Chartered
Saving For Education:

Upwardly mobile Pakistanis see the value of education for their children. 18% of them say saving for their children's education is a top priority.

Saving For Education. Source: Standard Chartered

Summary:


Standard Chartered Bank study finds that Pakistan is among the most upwardly mobile nations in terms of income and education. 79% of Pakistanis feel they are better off than their parents.  34% of socially mobile Pakistani respondents say their incomes have increased by more than 50% over the last 5 years while 44% say they have seen 10% or more income growth in the last year. 89% of them have college degrees compared to 66% of fathers and 49% of mothers who did.

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4 comments:

nayyer ali said...

Isn't this just saying that among those doing well (the socially mobile), they are in fact doing well? Ins't that rather redundant and stating the obvious? What percent of the total population in each country is considered "emerging affluent"? Is it 50% on China and 30% in India and 20% in Pakistan? That would be a more useful comparison. To say that the segment of the population that is doing well and has a college education is in fact doing well and has a college education is to just repeat the premise.

Riaz Haq said...

NA: "Isn't this just saying that among those doing well (the socially mobile), they are in fact doing well? Ins't that rather redundant and stating the obvious?"

Here are a few excerpts of the summary of SC report:


In societies with high rates of upward social mobility, people
have the chance to carve out a life for themselves and their
children that surpasses that of their parents. The number
of people climbing the social ladder is slowing in the West1
.
But we are seeing a new group of people in fast-growing
economies in Asia, Africa and the Middle East who are
accumulating wealth and rapidly improving their personal
wellbeing.
We call this group the ‘emerging affluent’. They have money to spend, save
and invest. This is our fourth study of this important consumer group: we
believe their economic power represents a significant driver of market growth.
The emerging affluent are creating their own prosperity by achieving more
in their education, careers and businesses than their parents did. Digital
technology is broadening their access to money management and helping to
support their financial wellbeing. But there is still room for the emerging affluent
to aspire to, and reach, even more ambitious goals.
As a leading international bank helping clients prosper across Asia, Africa
and the Middle East, we want to understand how people maximise
opportunities to advance themselves and their children. That includes gaining
a better appreciation of their aspirations and the financial tools they need to
achieve them.
Our study does just that: it provides fresh insights into the social mobility of
the emerging affluent across these regions. It reveals that there is space for
improved investment strategies among this group. They want to keep reaching
higher through smarter choices but they feel held back by a lack of financial
knowledge.

https://av.sc.com/corp-en/content/docs/SC-Emerging-Affluent-Study-2018-Climbing-the-Prosperity-Ladder.pdf

Riaz Haq said...

#Indian #Muslims left out of #India's growth story, World Bank study shows. Mobility levels for #African-#Americans in the #US are better than those for Muslims in India but #mobility among lower caste SCs, STs is comparable to that of African-Americans. https://www.livemint.com/Politics/E32q8vPxpaiYIpqcql8OYM/Muslims-left-out-of-the-India-growth-story-study-shows.html

“Higher caste groups have experienced constant and high upward mobility over time, a result that contradicts a popular notion that it is increasingly difficult for higher caste Hindus to get ahead,” Asher and his co-authors point out. The extent to which inter-group differences in mobility are driven by location varies substantially by group. Among STs, the district of residence explains 59% of the upward mobility gap with upper castes, the study shows. Place matters considerably less for SCs (14% of the upward mobility gap) and Muslims (9% of the upward mobility gap).

Riaz Haq said...

According to a Gilani Research Foundation Survey carried out by Gallup Pakistan, 42% Pakistanis believe that their household’s financial situation will improve in the coming year.

http://gallup.com.pk/42-pakistanis-believe-that-their-households-financial-situation-will-improve-in-the-coming-year/

A nationally representative sample of men and women from across the four provinces was asked, “Do you think your household’s financial situation will improve, worsen or remain the same in the coming year?” In response to this question, 42% said that they believe that their household’s financial situation will improve, 36% said that it will remain the same, and 22% said that it will worse.

This question is used as a proxy across the world for gauging consumer’s confidence in the economy currently, and a predictor for the future. Gallup Pakistan is currently in process of setting up a Consumer Confidence Index.