CCL: More than half of the middle class is informal

Of a total of 6.5 million workers belonging to the middle class in Peru, 3.6 million worked in informal conditions during the year 2023, representing an increase of 186,000 workers compared to 2022, according to the Institute of Economy and Business Development (IEDEP) of the Lima Chamber of Commerce (CCL). This means that 55.3% of the working middle class is informal.

Óscar Chávez, head of the IEDEP of the CCL, explained that the middle class is essential to sustain private consumption and economic reactivation, which is why the figures on labor and business informality are worrying. “This leads to negative effects on the country’s productivity and competitiveness,” he said.

The analysis carried out based on the National Household Survey (ENAHO) 2023 indicates that the middle class represented 37% of the workforce, which reached 17.7 million workers. This middle class condition is established when the monthly household income fluctuates between S/3,125 and S/18,079.

Middle class by sectors

The sectors, according to the analysis, What concentrates the most middle class workers are services (42.4%) and commerce (20.7%). This is followed by manufacturing (10.9%), transportation and communications (9.1%) and agriculture (8.3%).

62.1% of middle class workers are dependent, while 27.2% are independent. Additionally, 5.7% are employers and 5% are domestic or other workers.

Concentration in Lima

At the national level, Lima concentrates approximately half of the national middle class (50%), followed by La Libertad with 20.6%. While in Moquegua, Ica and Arequipa, the middle class represents more than 40% of its population. “These results show disparities in living standards between the capital and the rest of the country,” said Chávez.

Regarding human capital, it is observed that 27.8% of people who are located within the middle class have completed secondary school, 13.1% have completed non-university education and 16.5% have completed university studies.

Keys

Goal. Owning your own home is an aspirational good for the middle class. 71.6% live in their own home and of that figure, 65.1% have the property fully paid for. 15% share a home and 13.3% live in a rented one, says the IEDEP.

Solidity. Having a home already paid for, explains Chávez, makes it possible to make financial decisions where the property can be used as collateral, since 7 out of every 10 fully paid-off owned homes have a property title or it is in process.