China’s wealth paradox: Fewer rich, greater inequality

What happened The number of China’s wealthy households is shrinking as spending power shifts. According to the Hurun Wealth Report 2024, released on February 27 by the research group Hurun Research Institute, the number of Chinese households with assets over 6 million RMB ($830,000) has fallen 0.3% year-on-year to 5.128 million. The report covers 108 cities across 34 regions, including Hong Kong, Macau, and Taiwan. The decline is more pronounced among high-net-worth and ultra-high-net-worth households. Those with over 10 million RMB ($1.4 million) dropped 0.8%, while households with assets exceeding 100 million RMB ($14 million) fell 1.7%. At the highest tier, international ultra-high-net-worth households (over $30 million) saw a 2.3% decline, losing 2,000 households. Despite the dip, China is on the cusp of a historic wealth transfer. Over the next 30 years, 79 trillion RMB ($11 trillion) is expected to pass to the next generation, with 20 trillion RMB ($2.8 trillion) shifting hands within the next decade. The Jing Take Even as the number of wealthy households in China shrinks, the gap between the rich and ultra-rich continues to widen. In 2024, the 5.128 million families with assets of at least 6 million RMB ($830,000) controlled a combined 150 trillion RMB ($21 trillion) in wealth. Notably, the top 130,000 households now account for 58% of that total, up from 56% the previous year — a sign that wealth is becoming increasingly concentrated at the highest levels. This growing disparity is playing out in consumer trends. Last year, consumption in China rose just 3.5%, lagging the country’s 5% GDP growth, suggesting that income inequality is weighing on spending. Implications for luxury brands, consumption Luxury brands, which have long relied on China’s wealthy elite as a pillar of growth, now face a more cautious spending environment amid economic uncertainties, including the escalating trade war with the U.S. Analysts have warned that closing the wealth gap will be crucial to stabilizing the economy, particularly as Beijing looks to private sector growth to propel a recovery. Meanwhile, the Hurun Research Institute last year reported that the number of US dollar billionaires in China fell by 142 YoY to 753, as of August 30, 2024. Since peaking in 2021 at 1,185, the country has lost over a third of its billionaires, a significant shift in the nation’s wealth landscape. ByteDance founder Zhang Yiming took the top position last year for the first time with $49.3 billion in wealth. How the next generation will reshape luxury markets However, with a massive wealth transfer on the horizon, new doors are potentially opening for luxury brands. As fortunes shift to a younger, digital-native generation, brands can expect a greater emphasis on experience-driven luxury, sustainability, and digital innovation as China’s next wave of UHNWIs reshapes the market. The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

China’s wealth paradox: Fewer rich, greater inequality

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Published March 04, 2025

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China’s wealth paradox: Fewer rich, greater inequality