HCES 2023-24: Average monthly household spending increases further, non-food items account for more than half of spending

The average monthly consumption expenditure of households in both urban and rural India increased further in 2023-24 from 2022-23 as the trend towards increased expenditure on non-food items continues. However, there remains a sharp gap between average consumer spending between the top 5% and bottom 5% in both urban and rural India, as well as average spending in the top 5% in urban and rural India.

According to the results of the Household Consumption Expenditure Survey 2023-24 released on Friday, the average monthly consumption expenditure per capita (MPCE) in rural and urban India in 2023-24 has been estimated at Rs. 4122 and Rs. 6,996, respectively, without considering the values ​​of items that families receive for free through various social welfare programmes.

This represents an increase of about 9% in rural areas and 8% in urban areas from the 2022-23 level of Rs 3,773 and Rs 6,459, respectively.

Considering the calculated values ​​of the items obtained for free through various social welfare programmes, these estimates become Rs 4,247 and Rs 7,078, respectively, for rural and urban areas.

“In line with the trend observed in the Economic and Social Household Survey: 2022-23, non-food items remain the major contributor to average monthly household expenditure in 2023-24 with a share of about 53% and 60% in MPCE in rural and urban areas respectively,” he said. “. Official statement from the Ministry of Statistics and Program Implementation.

This is the second round of Household Consumption Expenditure Survey in recent years and was conducted between August 2023 and July 2024. Before that, the Household Consumption Expenditure Survey 2022-23 was conducted between August 2022 and July 2023. The data is expected to help The government updates the CPI baskets, which are used to measure inflation in the country’s retail sector. It also gives policy makers and companies an idea about household consumption patterns and income levels.

“The survey provides the data needed to assess trends in economic well-being and define and update the basket of consumer goods and services and the weights used to calculate the consumer price index. The data collected at HCES is also used to measure poverty, inequality and social exclusion,” the statement said.

Main spending items:

The main contributors to household non-food expenditure in 2023-24 were transportation, clothing, bedding, footwear, miscellaneous goods, leisure and durable goods. “Rent with a share of around 7% is another major component of non-food expenditure of households in urban India,” the data showed.

In food, beverages and processed foods remain the main contributor to total food consumer spending in 2023-24, followed by milk, dairy products and vegetables. Households in both urban and rural India spend marginally more on beverages, processed foods, vegetables, fruits and animal proteins including eggs, meat and fish in 2023-24 than 2022-23.

Spending breakdown:

The data revealed that the bottom 5% of India’s rural population, ranked by MPCE, had an average MPCE of Rs 1,677, representing a 22% jump from 2022 to 2023 when the MPCE for this sector was Rs 1,373. The MPCE for the poorest 5% of urban population rose to Rs 2,376 in 2023-24, representing a 19% rise from Rs 2,001 in 2022-23.

The gap in monthly spending among the top 5% of urban households remains nearly double that of the top 5% of rural households. The top 5% of rural and urban population in India, ranked by MPCE, have an average MPCE of Rs 10,137 and Rs. 20310 respectively.

The urban-rural gap in MPCE declined to 71% in 2022-23 from 84% in 2011-2012, the statement said, adding that it declined to 70% in 2023-2024, underscoring the continued momentum of consumption growth in the country. Rural areas.

He further stated that consumption inequality, both in rural and urban areas, has declined from the 2022-2023 level. The Gini coefficient decreased to 0.237 in 2023-2024 from 0.266 in 2022-2023 for rural areas and to 0.284 in 2023-2024 from 0.314 in 2022-2023 for urban areas.