The middle class is collapsing and the poor and “vulnerable” are now the majority in the City

In the first three months of this year poverty skyrocketed again in the City of Buenos Aires, that was nourished by decline of the middle class. Poverty increased by 1,083,000 people compared to 928,000 in the fourth quarter of 2023. There are 155,000 new poor, which largely came from the middle class that was reduced by 100,000 people.

Meanwhile, child poverty affected 44% of children under 17 years of age (301,000). A year ago, 37.4% of children and adolescents (0-17 years) lived in households in poverty.

According to the Report of the Directorate of Statistics and Censuses of the City of Buenos Aires, Poverty reached 35.1% versus 30.1 at the end of 2023with a very strong drop of the middle class, which fell from 40.7% to 37.4%.

The impoverishment of the Buenos Aires middle class has been a constant in recent years. The middle class falls almost 18 percentage points compared to its best record, which was the third quarter of 2017. Then it totaled 1,691,000 people, while in the first quarter of 2024 they fell to 1,254,000. In 2015, when the statistical series began, The middle class reached 51.9% and now it is 37.4%.

While, destitution reached 15.3% of people (472,000 people) when in the fourth quarter of 2023 it was 12.2%. Indigence almost doubles its incidence compared to the same period of the previous year, both in households (10.8% vs. 5.5%) and in individuals (15.3% vs. 8.4%).

“Poverty – and in particular indigence – reaches the highest incidences of the series started in 2015 for a first quarter. In a context of reduced activity and employment rates, the expansion of labor and non-labor income was not enough to offset the price increases. As a result, the living conditions of households in the City deteriorated across the board, affecting access to basic food baskets and reducing the weight of the middle and wealthy sectors”says the Buenos Aires Report.

In turn, “households in poverty together with those in vulnerable situations make up the aggregate of households in vulnerable conditions, which in the period represent 41.7% of the total. 46.4% of the City’s population resides there.” So There are more poor and vulnerable than the middle class.

The decline in well-being is also observed in the middle sectors. Some 155,000 households and some 364,000 people who were in this stratum a year ago are descending in the income pyramid (a decrease of almost 12 points).

The Report details that some groups are more impacted by poverty than others.

• Households headed by women (where the incidence of poverty is 34.4%, compared to 26.2% with a male head).

• Households headed by an unemployed person (1.7 times higher than the total incidence), or by a person employed in domestic service (75%).

• Also to households located in the southern area and those with children under 14 years of age, the latter with incidences of poverty and indigence that increase with the number of children in the home.

• Households with elderly people living in poverty account for 30%, a figure close to that of the total population.

• Households in vulnerable situations represent 11.4% (154,000 homes) and 11.3% of the population (349,000 people) live there. Added to the group of households in poverty, they make up vulnerable households, which amount to 41.8% (about 565,000 homes), in which 46.4% of the population lives (about 1,432,000 people). In the last year, this population aggregate expanded from 31.9%.

• The middle sectors associated with the “middle class” represent the largest category: 41.4% of the households in the City of Buenos Aires and 37.4% of the population (about 561,000 households and 1,154,000 people, respectively) and its participation contracted 11.7 points in households and 11.8 points in population in the last year. These incidences are the lowest in the historical series that began in 2015.