Uganda's Vision of Middle Income Status: Why the Growth of the Middle Class Matters

Uganda aspired to become a lower middle income status country by 2020. The study examines why Uganda could or may not achieve this goal. The study uses two most recently available rounds of Uganda National Household Survey ( i.e. 2012/13 and 2016/17) to achieve three objectives of; (i) estimating the size, geographical distribution, composition and characteristics of the middle class; (ii) examine patterns and spatial distribution of the middle class; and (iii) identify the factors driving Uganda’s middle class. Analysis shows that the middle class population (without those in floating category) more than doubled from about 3.7 million in 2012/13 to about 8.3 million Ugandans (22 percent) in 2016/17. However, if those in floating middle class category are included, this group was about 21 million, indicating that majority of Uganda’s middle class (over 13 million) are floating, classified as between the poor class and the lower-middle class. This alludes to Uganda’s middle class being of an inferior quality and highly fragile. Nonetheless, the middle class plays a critical role in the economy – for example in, driving consumer markets; partaking technological application, and promoting the services sector. Key drivers of the middle class in Uganda include urbanization, small household sizes, education, and economic activities including entrepreneurial development. Policies that reduce vulnerabilities of the floating class to ensure that they are resilient to economic shocks should be promoted. In addition, policy should target growing and sustaining the lower and upper middle classes, as a pathway to sustainably accelerate the attainment of national policy goal of middle income status.