Afford Ability Dictates Asset Ownership

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Published: Mint dated 25th April, 2011

Indicus Consumer Data Products

The heterogeneitythat characterizes

the modern Indianconsumer has

created a mazethat marketerswould like tounravel in order totarget theirproducts and

services precisely.In this fortnightlyseries, IndicusAnalytics will

present the various

facets of urbanconsumers, acrossgeographies andsocio-economicgroups



The second largest sub-segment of urban SEC E households is formed by

households whose chief wage earner is middle-aged and married with youngchildren. The chief wage earner is an unskilled worker with low levels of education-amajority have completed just primary school.

With little educational backing, most of the chief wage earners have managed to find

work as casual workers; while a little less than one-third have their own businesses,which would include small kiosks, hand carts, etc., essentially in the trade sector. A

little over one-quarter of chief wage earners have regular salaried jobs at the lowestlevel in small businesses or households.



Broadly, the source for livelihood in this category comes from the unorganized

sector, with just about 7% working with the government or private sector companies.Those who work in large firms or the public sector would have completed middleschool, but again, would be at the lowest rungs of income.

When it comes to sectors of employment, construction and real estate account for

jobs to almost half the segment, followed by manufacturing, transport andcommunication, and agriculture and related activities. The presence of the last

category shows low education and skill base restricts employment to primaryactivities. Even in metros, there is a minuscule percentage of people involved incropping, fishing, etc. This sector forms a major source of livelihood in urban areas of

districts such as Medinipur, Bellary, Jalgaon, etc.



Households in this category typically consist of

four to five members. These are, to a largeextent, nuclear families and less than 10% havesenior citizens. Around 40% have more than twochildren, even in the lowest income segments inurban areas. As expected, northern districtsshow greater tendency for more children; more

than 60% of the households have more than twochildren in six towns—Jodhpur, Bikaner, Aligarh,

Bareilly, Bhavnagar and Gwalior.

The spouse of the chief wage earner also has

low levels of schooling—less than one-third havemade it to middle school. In most households,the spouse is a home maker, taking care of thechildren. In about one-fifth of the households, thewomen are also employed outside the homes.Interestingly, in Vellore, Erode, Dharwad andVirudhunagar, more than 40% of the spousesare earning, while Srinagar has the lowestparticipation of spouses in this category.



In most households, the chief wage earner isthe sole earning member and annualhousehold incomes fall predominantly in thelowest income class of less than Rs. 3 lakh ayear. Yet, as these earners are settled in theircareers and families, more than half thehouseholds own houses. A little more than one-third of the households stay in rented houses,

while a mere 7% live in employer-providedaccommodation. The smaller towns with moreaffordable real estate prices see higherownership of houses even among thissegment. When it comes to asset ownership,households in this category clearly go in for

two-wheelers as the vehicle of choice, basicallyfor reasons of affordability. Still, the penetrationof two-wheelers is low with just 25 % of thesehouseholds owning a two-wheeler. Even whenthe need for a four-wheeler is high given thesize of family in a typical SEC E middle-year

household, ownership of car is this category israre.Ownership of refrigerators and microwaves islow while television penetration level is high.This segment is not as net-savvy as theyounger SEC E households, and it is televisionthat scores much higher than all other media;even radio gets one-fourth of the time spent onan average by a household on watching TV.

Afford Ability Dictates Asset Ownership

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