The black Toyota Yaris speeds out of the dealer’s parking lot merging nervously into the main thoroughfare, almost conscious of its reduced size and newcomer status on the busy Santiago roads.
Sturdy and unassuming, the Yaris is an apt metaphor for the status of its occupants and brand new owners: the Pugh family of five, who have fought hard to join the ranks of Latin America’s middle class, and are now enjoying their new place in society while cautiously navigating the bumps in the road to prosperity that lies ahead of them.
More than 50 million people like the Pughs have worked their way up the social and income ladder in Latin America in the past decade to become members of the middle class –an increase of over 50%. Almost one third of Latin American families are now considered to be middle class, a development that has also helped shrink the region's share of the poor to almost the exact same proportion (or 30% of the population), experts say in a new study.
“It’s a historic increase , related to the drop in unemployment rates and informal employment. Therefore, the growth of the middle class in the past ten years is down to growth dynamics and job creation,”explains World Bank Regional Chief Economist Augusto de la Torre.
This is welcome news for the millions of Latin Americans who fall into the middle class income bracket of US$10-US$50 per capita per day. But, as global conditions worsen, experts worry that people may be squeezed out of their newly achieved status.
As it turns out, the current spike in middle class numbers is a direct result of the record economic expansion and job creation of the past few years, and which could become the first casualty of the growing economic turmoil in Europe, and slowing growth in China.