middle class poverty and the social web

It is very obvious that the lower income end of the middle class is struggling, and even the middle income ones too. Under our current government, a great deal of income redistribution has taken place towards those on low incomes or on welfare, but this has come mainly from those on middle incomes. The result is that the middle classes are often cited as the new poor, having only marginally greater spending power than those they are being taxed to help. As prices have increased, especially for energy in all its forms, along with greatly increased taxes, this large group has much less spare cash, and is now reducing expenditure on optional items. And as spare cash is eroded, every extra price increase has a proportionately larger effect.

Media articles on middle class belt-tightening have been abundant recently. Today, the Times features a graph showing a steep increase in sales of value products, with sales of premium products falling sharply.

But shopping changes are not the only ones. The web is really starting to pick up now as a platform for social entrepreneurs. I was very impressed last year when I discovered freecycle, which was a great way of getting rid of surplus stuff when we merged two households. Many of the people on the receiving end were short of cash, but many weren't. I found that interesting, but it is fully in line with the Time's other article on the subject, which pointed to a growing area of the middle class that is socially confident enough to penny pinch in one area to liberate cash for another, to turn up in a newish Mercedes to collect some free toys. And another that really doesn't see this as penny pinching at all, it just doesn't feel any social need to pay more. Price status has evaporated as a key issue for them. And as it is the middle classes who create such sites, and will create the future ones, pressuring them via financial stress will accelerate social use of the web.

So, some interesting weak signals are coming through here. Firstly, designer stuff is no longer a good indicator of social status. Even people who can afford to pay more are very happy to shop around more, to use discount vouchers, or shop in places that previously were frequented only by those on low incomes. And they do so without losing their social confidence. This applies much more to the middle and upper parts of the middle class than to the lower middle class. If designer labels are being reassigned further down the social hierarchy to wannabes rather than achievers, that will be a very interesting trend indeed.

Secondly, a refocus on value rather than image will destroy a great deal of what was a very strong trend indeed, the Dream Society, as Rolf Jensen called it in his excellent book. Image is important, and accounts for a great deal of the purchase price - up to now. That may be ending, or at least taking a long pause while the recession plays out. Companies will focus much more on product offerings that give high functionality and value, rather than trying to go for image.

Thirdly, this is all happening against a background of hightened environmental awareness. Indeed, this is the cause of at least some of the price rises. As value becomes more important, and frills are stripped, there is often an environmental benefit too. Freecycle was mainly intended to tackle landfill problems. The new frugality is also environmentally friendly, reducing waste.

Fourthly, community is likely to benefit. People are more reliant on each other. Freecycle and its ilk encourage social mixing, awareness of others, and various other benefits. Expect many other social enterprise groups to spring up on the net that will use cost savings as a booster to otherwise modest business plans or finance other community benefits.

Fifthly, as social use of the web accelerates, political activism will grow too. The middle classes are good at articulating their concerns, and can well understand basic IT. The extra pressures on them will bring forth many activists who would previously have sat at home watching TV. We should expect political debate to grow, and actions to be taken. Political casualties will litter the corridors of westminster and local council chambers. Brown is expected to be evicted any time now, but there will be many other targets in the revolution.

Finally, well, mainly because I am suffering post-lunch dip now, we will see a refocus on quality of life issues around relationships. Hard times can bind people together, providing a common enemy.

So all in all, the middle classes might have less cash, and plenty to whine about, but there will be some nice long term benefits as a result - a less wasteful world, more efficiently using resources, where companies focus on substance rather than spin, where basic human values take over from acquisition, and the care economy takes another big step forwards.