I just saw a CNN headline that read: “Young workers scrimp to live on $15/wk.” Before reading further, what do you think: Is that stunning and shocking? Or shockingly typical?
The story turned out to be a piece about white-collar workers in China trying to live frugally, spending only 100 Yuan on travel and food during the workweek to conserve funds. Of course, the workers’ actual total expenses and income are higher, because that $15/week figure doesn’t include weekend expenses and other major costs like rent. Even so, the story is considered newsworthy here, and is probably a shock to a number of readers in the western world.
But the headline wouldn’t surprise readers who are familiar with the approximate distribution of income/GDP/wealth in the world.
To illustrate, here are two personal data points from 2006, when my wife and I traveled to Kenya and Zambia to visit friends:
- Income: In Kenya, we were told that being a staff worker at a safari lodge is considered a good job. What does it pay? About $2 per day, for long hours and six-day weeks. This isn’t unusual; in about 30 countries, including Kenya, more than half of the population earns under $2 per day. An estimated two billion people – 30% of the world’s population – live on an income of less than $3 per day. And $3 per day is about what the attention-grabbing CNN headline implies, though the actual story behind that headline is much less bad.
- Cost of living: But what happens when we consider, not just dollar-for-dollar comparisons, but purchasing power? Isn’t it less expensive to live in less-developed countries? Yes, it usually is, especially for shelter and services – there’s been some talk lately on the U.S. news about retiring in Mexico as a way for older people to save money in this economy – but the difference for the same quality goods is often less than one might think. In Lusaka, the capital of Zambia, we found there were only three grocery stores [*] having similar goods to what we would expect to find in a U.S.-style Safeway, although of course the Zambian stores were much smaller than U.S. stores (more the size of a medium Trader Joe’s) and offered far less selection diversity (something like a factor of 20 fewer varieties or brands). When we visited one of the stores, I picked up a few Western-style items, totaled the price and converted to U.S. dollars in my head, and found that those comparable products in Lusaka cost nearly the same as we would have paid for the same items in Seattle. Our local friend replied: “Right, nobody who lives here would ever think of buying a can of soda pop.” Certainly not when a can of Coke costs a day’s wage for many people, and doesn’t confer any significant nutritional benefit.
The gulf between the western- and world-median standards of living is, simply put, vast – and growing. The standard of living that’s normal for most of the planet’s population is well nigh unimaginable to many of us in the western world, and even for those of us who’ve been there, it’s one thing to see it and quite another to really understand what such a life would be like. I don’t claim to.
[*] They might well be the only such stores in the country, not just the capital.