China in a Decade: Rapid Growth of Resident's Income with Improved Quality of Life

III. Rising consumption of residents with an optimized consumption structure

Since the 18th Party Congress, China has introduced a number of measures to expand the consumption of residents and continued to improve the market environment to drive consumption increase and structural upgrading.

1. Greater shopping power of consumers

In 2021, the per capita consumption expenditure of residents nationwide reached 24,100 yuan, up 12,046 yuan from 12,054 yuan in 2012, with a cumulative nominal growth of 99.9% in per capita values and an average annual nominal growth of 8.0%, and a cumulative real growth of 67.4% and an annual growth of 5.9% after deducting price factors.

2. Engel’s coefficient had dropped as the quality of life continues to improve

In 2021, the national per capita spending on food, tobacco and alcohol reached 7,178 yuan, an increase of 80.2% over 2012 with an average annual growth of 6.8%. The proportion of spending on food, tobacco and alcohol to overall consumption expenditure (Engel’s coefficient) decreased from 33.0% in 2012 to 29.8% in 2021, down 3.2 percentage points.

3. Optimized consumption structure with development-oriented and enjoyment-oriented consumption on the rise

The national per capita expenditure on transportation and communication in 2021 reached 3,156 yuan, accounting for 13.1% of the total annual consumption, up 1.1 percentage points from 2012. The per capita expenditure on education, culture and entertainment in 2021 reached 2,599 yuan, accounting for 10.8% of the total annual consumption, up 0.3 percentage points from 2012. In 2021, the per capita expenditure on health care reached 2,115 yuan, accounting for 8.8% of the annual total, up 1.8 percentage points from 2012. The per capita expenditure on services in 2021 accounted for 44.2% of the annual total, 4.5 percentage points higher than that in 2013.