This is not to say that other socio-economic classes do not matter. But development almost always calls for growing the middle class in every nation. In much of Africa, the middle class is shrinking, often for economic and political reasons. And it is not that these families are moving up into the upper class. Most are falling into the lower class. We should be moving people from the lower class into the middle class, but too often we get the reverse.
This is bad, and I do not think people grasp how bad it is. I believe it is one of the reasons so many companies fail in Africa. Every economy thrives on its middle class. They have the disposable income to spend, and they should make up the bulk of the population. When we squeeze them out, we are left with a country that has little money to spend, and companies that cannot make enough sales to survive.
Look at Nigeria
Let me make this concrete with the country I know best.
In the 2000s, Nigeria's economy grew quickly, and the middle class grew with it. A World Bank study, No Condition Is Permanent, found that the share of Nigerians who could be called middle class rose from about 13 percent in 2003 to about 19 percent by 2013, while poverty fell from 45 percent to 33 percent. That was real progress, even if it came more slowly than our strong growth rates promised.
Then it stalled, and then it slipped. Nigeria fell into recession in 2016 and again in 2020. Inflation climbed, and in 2023 the naira lost much of its value. The African Development Bank has long warned that most of Africa's middle class is a "floating class," living on roughly two to four dollars a day, one shock away from falling back into poverty. In Nigeria, the shock came, and millions fell.
You can see it in the income figures. These are annual figures: a country's total output for the year divided by its people, which the World Bank uses as a rough measure of average income per person. In US dollars, it puts Nigeria's at about 550 dollars a year in 2000. It climbed above 3,000 dollars a year by 2014 and held near that level for a few years. By 2024 it had fallen to about 1,100 dollars, roughly a third of the peak. Much of that drop is the naira's collapse, but that is exactly the point: when your currency and your wages (their purchasing power, specifically) cannot hold their value, your middle class cannot hold its ground.
Now compare that with the West
Over the same years, look at a country like the United States.
In 2000, the same yearly measure put American income per person at about 36,000 dollars. By 2024 it was about 86,000 dollars a year, more than double. It did not boom and then crash. It rose, almost year after year.
Its middle class did shrink in one sense. The Pew Research Center found that the share of American adults in middle-income households fell from 61 percent in 1971 to about 50 percent by 2021. But notice two things. Even after that decline, about half the country is still middle class, a share Nigeria has never come close to. And the middle class that remained grew richer: Pew found its typical household income rose by about half between 1970 and 2020.
So here is the contrast. In America, the middle class slowly thinned but stayed large, and the families in it have more to spend than they did a generation ago. In Nigeria, the middle class never passed one in five, and then much of it was pushed back toward poverty. One country's people grew better off. Ours, in real terms, too often grew poorer.
One of the clearest ways to build the middle class is employment: making sure everyone who can work has a suitable job that pays a living wage. To get there, we need education. We need to make sure our large population has the skills companies actually demand.
This is why the work at Pan-African Innovation City matters. We are building the people, ideas, and enterprises that expand the middle class and help other African companies thrive. They thrive on the skilled technicians we train, the ideas and solutions we develop for their problems, and the enterprises we help start that create jobs and pay wages Africans can spend.
We must expand Africa's middle class.
Sources: World Bank, World Development Indicators — GDP per capita, current US dollars, Nigeria and the United States (data.worldbank.org). World Bank, No Condition Is Permanent: Middle Class in Nigeria in the Last Decade, Policy Research Working Paper 7214, 2015 (openknowledge.worldbank.org). African Development Bank, The Middle of the Pyramid: Dynamics of the Middle Class in Africa, 2011. Pew Research Center, How the American Middle Class Has Changed in the Past Five Decades, 2022 (pewresearch.org).