China's developing middle class.

China's middle class is growing rapidly and will be an enormous market for consumer goods of all types within a fairly short time frame. An analysis provided to the press via email by The McKinsey Quarterly, published by McKinsey & Company, the global management consulting firm said, "A social revolution will soon transform China, and multinationals that do business there can't afford to ignore it."

McKinsey identifies five Chinese urban income segments. The top segment is called "Global Affluent" and has an income over us$26,300. The next highest income segment is "Mass Affluent" with annual income between us$13,150 and us$26,300. The middle segment is the "Upper Middle Class" having an income between us$5,260 and us$13,150. The "Lower Middle Class" has an income between us$3,288 and us$5,260. McKinsey classifies the "Poor" having an income of less than us$5,260.

"By 2011, McKinsey research suggests, China should have a lower middle class of 290 million people; by 2025, the upper middle class will be 520 million strong, with staggering disposable wealth."

McKinsey predicts that urban spending for housing and utilities will grow at an annual rate of 11.8 percent between 2004 and 2025. Healthcare, the only other category displaying a double digit growth rate, will increase 11.6 percent during the same period.

Spending for recreation and education will increase 9.5 percent from 2004 to 2025.Both personal products and transportation/communications will grow at an annual rate of 9.3 percent over the period.

"Tomorrow's middle-class consumers are today's relatively poor urban workers," says McKinsey, implying that now is the time to begin marketing efforts.