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The GroupM Knowledge-Hurun Wealth Report 2013
Hurun Report        2013-08-14        Back

 

Chinese Millionaires Grow by 3%, Slowest Rate in 5 Years

The GroupM Knowledge-Hurun Wealth Report 2013

by GroupM Knowledge and Hurun Research Institute

 

 

(August 14 2013, Shanghai) Hurun Research Institute together with GroupM Knowledge today released the GroupM Knowledge-Hurun Wealth Report 2013. The 40-page research report analyses China’s wealthy people broken down according to their regional distribution across China, as well as their investment, consumption preferences, and how they use the media. This report will help marketers to better understand the lifestyle of China’s wealthy population and to communicate and engage with them more effectively.

 

This is the fifth wealth report by Hurun and the third consecutive report working in association with GroupM Knowledge.

 

Some of the key findings are

 

1.      The number of millionaires grew (defined as individuals with personal wealth of CNY 10 million, equivalent to US$1.6 million and GBP 1 million) by 3% in 2012 to 1.05 million, while the number of the super-rich (defined as individuals with personal wealth of CNY 100 million, equivalent to US$16 million and GBP 10 million) reached 64,500, up 2% from the previous year. The growth, the slowest one in five years, has decelerated for the second consecutive year.

 

As of the end of 2012, in all the 31 autonomous regions, cities and provinces excluding Hong Kong, Macau and Taiwan, the number of millionaires has increased by 30,000 from last year to 1.05 million, while the number of the super-rich has increased by 1,000 to 64,500 – an increase of 3% and 2% respectively. The growth, the slowest one in five years, has decelerated for the second consecutive year. At present, one out of every 1,300 people in China is a millionaire, and one out of every 20,000 people in China belongs to the super-rich class.

 

2.  Beijing remains in the first place, followed by Guangdong and Shanghai.    Tianjin saw the fastest growth rate in the country, while Zhejiang Province and Inner Mongolia dropped the most.

 

Beijing remains in the first place with an increase of 5,000 to 184,000 millionaires, and with an increase of 200 to 10,700 super rich. Guangdong ranks the second with 172,000 millionaires and 9,600 super rich. It is followed by Shanghai with 147,000 millionaires and 8,500 super rich. Tianjin rose to the tenth place, with 19,000 millionaires, up 11% from the previous year, as well as 1,400 super rich, up 12% from the previous year - the fastest increase in all the cities. Other fast-growing provinces include Shandong, Henan, Yunan, Guizhou, Qinghai and Tibet. About 60% of China’s wealthy population are located in the second and third tier cities such as Hangzhou, Ningbo and Foshan where the number of millionaires exceed 20,000. The research indicates that, although the number of China’s millionaires is growing generally, the number of some areas decreased slightly among which Zhejiang Province and Inner Mongolia dropped the most.

 

3. A quarter of millionaires say they are very confident about China’s economy in the coming two years, a decline of 3% from the previous year and half that of the year before.

A quarter of millionaires say they are very confident about China’s economy in the coming two years, a decline of 3% from the previous year. The confidence level of the year before was 54%. 66% of the millionaires say they are fairly confident - a 2 percentage point increases from a year earlier, while 9% of millionaires say they are not confident – a 2 percentage point increase from a year earlier and this is the highest one in last three years.

 

 

4.      The Hurun Millionaires’ Happiness Index has reached 7.8 out of 10. What millionaires want most of all is to have good health. A quarter are dissatisfied with their state of health.

Millionaire Happiness Index is a measurement of millionaire happiness based on four such factors as family, work, health and personal life, which is introduced for the first time in The GroupM Knowledge-Hurun Wealth Report 2013. Respondents to surveys were asked how happy they were on a scale from 0 to 10. Surveys show that millionaires’ happiness index has reached 7.8 out of 10. 73% of millionaires think they are happier than the previous generation; the happiness they get from their family is greater than that from their jobs; female millionaires’ happiness index has reached 8, slightly higher than that for men; the under 30s’ sense of happiness is notably lower than that of older people, particularly where their work is concerned.

 

Compared with love, time, recognition, learning and material needs, what millionaires want most is good health, and health problems are what concern them most. A quarter are dissatisfied with their state of health, and more than third feel that they do not do enough exercise. Women, and younger people, are more concerned about their physique. Around 30% of millionaires are dissatisfied with their work-life balance, with the younger ones most concerned about this issue. Some 20% of female millionaires have trouble sleeping.

 

 

Other interesting findings include:

 

l  There are currently 8,100 Renminbi billionaires and 280 individuals with personal assets of 10 billion RMB in China.

 

l  China’s millionaires fall into four categories: private business owners, stock market gurus, property speculators and high-salaried executives, in which the number of stock market guru dropped by 5% from the previous year, and the number of high-salaried executives grew by 5% from the previous year. The Chinese super-rich fall into three categories: private business owners, stock market gurus, and property speculators.

 

l  Real estate remains the first choice when it comes to personal investment in spite of the macro-adjustment measures, accounting for 64% of all investments. However, a certain proportion of Chinese millionaires also start seeking new investment opportunities.

 

l  The wealthy population spent 3% of their average wealth of 59 million RMB last year. A great 3% of their spending went to travel. Wealthy people are also more and more interested in seeking out unique travel experiences, and exotic destinations such as Africa or the polar areas are gaining popularity

 

l  On average, millionaires and the super-rich are away on business trips for fewer days a month than last year, a slight reduction of half a day and 3 days respectively. On average, millionaires leave China 2.8 times a year, down from 3 times last year and the super-rich leave China 3.4 times a year, down from 4.2 times last year.

 

l  Following the craze for studying abroad, there is now also an increasingly clear tendency to purchase overseas property. The U.S. is the top destination for overseas property purchase.

 

l  About 80% of wealthy people now use WeChat than using microblogs (70%), most of whom use it primarily for interacting with their friends.

 

 

Rupert Hoogewerf, Chairman and Chief Researcher of Hurun Report, said, “For the Chinese millionaire class, the key words this year are ‘Health’ and ‘Happiness’.”

Eve Lo, Chief Knowledge Officer, GroupM China, said, “Although the growth rate of China's millionaires is the lowest in the last five years, we can still gain insights into their life choices as revealed from the changes in their consumption and investment preferences, their perception of life and health and social responsibility, despite uncertainty in the wider environment.

This will help brand marketers to think deeper about what kind of value their brands could offer in their brand communication strategy.”

 

Methodologies

 

The GroupM Knowledge–Hurun Wealth Report 2013 investigates the quantity and geographical distribution of millionaires and super rich in mainland China. The report details the geographical distribution by province, municipality and directly-controlled municipality, based on the long-term residence of these wealthy people. The basis of the data is calculated up to the 31st December 2012.

 

The report takes into account both fixed assets and current assets of these wealthy people. Fixed assets include self-owned listed or unlisted stock rights, owner-occupied real estate, and investment real estate. Current assets consist of shares, funds, debenture shares, deposits, insurance etc.

 

Hurun Report in association with GroupM Knowledge compiled this report using the ‘bottom-up’ and ‘top-down’ research approach. The ‘bottom-up’ research approach takes into account the quantity of high-end real estate across the regions, sales volume of luxury cars in the past three years, individual income tax returns, the registered capital of enterprises and other high-end consumer indicators. The ‘top-down’ research approach is based on indicators such as GDP, GNP published by National Bureau of Statistics, combined with a Lorenz curve model to create a macro statistical analysis.

 

For details, please contact Hurun Report or GroupM Knowledge for the full report.

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