December 13, 2022: -On Thursday, wealthier Chinese were inclined to spend more this year, while wealthier people do not spend even more, McKinsey’s firm found in a survey.
The divergence contrasts with 2019, before the pandemic, when “there was a differentiation in spending amid the two groups,” the McKinsey analysts said. They noted that an official measure of consumer sentiment in China id decreased to an all-time low this year.
Lockdowns and travel restrictions in controlling Covid outbreaks in China increased more widespread this year as the contagious Omicron variant entered the country. A property market decrease also dragged down the economy.
Therefore, the survey found that more than a quarter or 26%, of people with an annual household income of more than 345,000 yuan said they increased their spending by 5% or more from last year.
The trend changed for those with far lower income, less than 85,000 yuan a year. Just 12% said they increased to spend, while 27% scaled back, the report added.
“The more affluent population is confident about their wealth and prospects,” McKinsey stated. “They remain relatively more confident about keeping employed and anticipating salary increases in the future. They also typically already have higher savings,” McKinsey further said.
“So, the more affluent group continues to spend, while lower-income groups are more hesitant and hold spending decisions.”
Across all the wage categories, the majority (about 60%) reported no change in spending this year. The share of the most wealthy that said they spent more was ten percentage points lesser than the 36% reported in 2019.
McKinsey’s survey of over 6,700 Chinese consumers was made in July.
In the months after the national data on retail sales slumped, Covid controls tightened in major cities like Beijing and Guangzhou.
The leadership landscape is profoundly changing, influenced by technological advancements, shifting workforce expectations, and the need for adaptability in an unpredictable global environment.
In the fast-paced business world, corporate leaders often find themselves at the crossroads of risk and reward, where bold decisions …
Corporate leaders often navigate turbulent waters where failure is not just a possibility but an inevitable part of the journey …
Corporate leaders play a pivotal role in shaping organizational cultures that embrace diversity and foster inclusivity. How can these …
Corporate leaders occupy a unique vantage point in the business world, offering insights and guidance shaped by their …
Corporate leaders today stand at the nexus of unprecedented technological evolution, where digital transformation reshapes industries and redefines …
The EU Green Deal is accelerating corporate sustainability efforts across industries, prompting significant leadership and strategic priorities shifts.
Morningstar has highlighted a compelling investment opportunity within the utility sector: midcap utilities.
Panera Brands announced on Tuesday that José Alberto Dueñas, the company’s Chief Executive Officer, has stepped down from his position, effective immediately
Microsoft has announced plans to significantly increase its investments in AI-enabled data center infrastructure, with projected expenditures exceeding $80 billion in fiscal 2025.
Leave us a message
Subscribe
Fill the form our team will contact you
Advertise with us
Fill the form our team will contact you
