Reflections on the Monetary Income of the Colombian Population.

With information reported on september 1st of this year, eight months after the end of 2.024, 1/ the official source reported the population results by income level for that year in the social classes designated as poor, vulnerable, middle class, and upper class.

These results show that the upper class represents 3.3% of the country's population, the middle class 34.4%, the vulnerable 30.5%, and the poor 31.8%. 2/ These figures are lower than those of 2.023 in monetary poverty but the same in vulnerable populations and higher than that year, with a larger middle class and a slight increase in the upper class. It is also worth noting that the poor and vulnerable collectively represent 62.3% in 2024, while the middle class and upper class represent 37.7%.

The poor, or monetary poverty, and for the purpose of comparing results from a previous year, in 2019 it registered 35.7%, in 2016 it was 36.2%, and even more so in 2012, 40.8%.

The vulnerable in 2019 were 31.3%, in 2016 it was 30.8%, and in 2012 it was 28.8%. The middle class in 2019 reached 30.4%, in 2016 it was 30.6%, and in 2012 it was 28.1%. The upper class in 2019 registered 2.6%, in 2016 it was 2.4%, and in 2012 it was 2.4%.

With the above, some observations are as follows. Monetary poverty has decreased compared to 2.012 and 2.024, falling from 40.8% of the population to 31.8% in those years. In contrast, the vulnerable population has increased from 28.8% to 30.5% in those same years. The middle class has increased, reaching 28.1% in 2.012 and 34.4% in 2.024. Finally, the upper class has increased slightly, from 2.4% to 3.3% over that period.

When adding the poor and vulnerable, the total in 2.012 was 69.6%, and in 2.025, it was 62.3%, as mentioned above. This decrease is more than 7 percentage points, explained by the reduction in the number of poor, as the vulnerable have not decreased.

Over a 10 year horizon, such as the one presented above, the reduction in monetary poverty is remarkable, registering a 9 percentage point drop. This explains why the middle class has grown by 6 percentage points, as they moved from poor to middle class. However, the low increase in the upper class reflects the stagnation of the middle class in terms of income that allows them to advance in social class.

This, along with the low percentage of this upper class compared to the other classes, reflects the growing inequality in income distribution, measured by the Gini coefficient, over this period. This is also because the poor and vulnerable make up more than 60% of the population. Indeed, the Gini coefficient for 2.012 was 0.539, for 2016 it was 0.517, and for 2019 it reached 0.526. However, this figure remains high and has worsened in recent years. It was 0.556 in 2022, 0.553 in 2023, and 0.551 in 2024. 3/

For public policy, along with the private sector, addressing population by income level and income inequality are priority objectives for the country's social and economic well-being.

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1/ The 2.024 information on monetary poverty was presented by the official source on july 24, and the full report, including vulnerable populations, the middle class, and the upper class, was released on September 1. This lag in annual information contrasts with the timeliness of other economic indicators such as inflation, unemployment, foreign trade, and GDP, which are presented monthly or quarterly. 

2/ For 2.024, the poverty, vulnerable, middle-class, and upper-class income lines were as follows: An average monthly income per household member of the country with less than 460.198 pesos per month is considered poor. Incomes between 435.375 and 897.987 pesos are considered vulnerable; incomes between 897.987 and 4.835.315 pesos are considered middle class; and incomes above 4.835.315 pesos are considered upper class.

For example, a household of four people, two of whom work, and who collectively receive 20 million pesos per month, is considered upper class, since on average each member receives 5 million pesos per month, exceeding the upper class income threshold of 4.835.315 pesos.

Similarly, if a household of four people, two of whom work, collectively receives 1.500.000 pesos per month, these individuals belong to the poor, since on average they receive incomes below the poverty line (each receiving 375.000 pesos).

3/ This inequality far exceeds that of other OECD countries and is among the highest in Latin America, along with Brazil and some Central American countries.