A few weeks ago i was having an interesting discussion with a group of friends about the Kenyan middle class. Much of the discussion was drawn from this particular article that had appeared in the Daily Nation some weeks back which had attempted to explain who the Kenyan middle class is. The link to the article is as below
I had big issues with the article, due to the classification of who we consider to be middle class. In advertising we would classify the Obure interviewed for the story as upper class or an A when you look at it from a social economic class classification. Unfortunately classification of a target audience using social economic class only took into consideration the income of the primary bread winner especially when households now have multiple incomes.The social economic classes were A, B, C1, C2, D, E.
Clearly using the social economic classes method of audience classification was not going to work especially with the growth in population and the rise of advertising in Kenya. So the Kenya Audience Research Foundation was formed and from around 2008, the Living Standard Measure (LSM) method of audience classification was introduced. LSM is a way of segmenting people based on their access to, and use of a wide range of products and services. A composite index is derived from a range of variables (products& services) that sum up the consumption and affordability status (and hence the living standard) of an individual. LSMs are a measure of affluence & development.
So a look at LSM shows that the middle class range from LSM 7-12 and that would range from upper to lower middle class. According to the Kenya National Bureau of Statistics, the Kenyan middle class can be defined as anyone spending between Sh23,670 and Sh 199,999 per month. Africa Development Bank however classifies the middle class as anybody with an annual income exceeding Sh331,500 ($3,900) or who spends between Sh170 ($2) and Sh1,700 ($20) a day.
I am more inclined to go with the with the Kenya bureau of Standards classification for the Kenyan scenario meaning that the guy interviewed in the Nation article is actually upper class by Kenyan standards. I would actually say that Obure is LSM 14 -15. As explained by the future capital blog http://futurecapitalkenya.blogspot.com/2011/03/who-are-middle-class.html an understanding of the middle class is very critical as they are the engine of growth in any economy. How the will influence the upcoming elections though, is yet to be seen…