Uganda continues to face significant income inequality, as highlighted by the 2023 Finscope Survey. The findings provide a clear snapshot of the country’s economic disparities, revealing the income distribution among Ugandans and underscoring the financial struggles faced by many.
The survey shows that over half (51%) of the population earns less than Ush150,000 per month, representing around 9.36 million people with a collective monthly income of Ush701.9 billion. In the next income bracket, 23% of Ugandans earn a midpoint income of Ush200,000, contributing Ush845.8 billion collectively. Another 16% earn between Ush250,001 and Ush500,000, adding Ush1,078.2 billion to the economy.
At the higher end, 7% of the population earns between Ush500,001 and Ush3,000,000, with a collective income of Ush961.8 billion. However, only 3% of Ugandans belong to the higher-income category, contributing a collective Ush1,448.8 billion. The highest earners, who make up just 0.29% of the population, collectively bring in Ush536 billion.
With a total population of 18.34 million individuals / households surveyed for the report, the mean income across all brackets is Ush327,988. This statistic reflects the stark economic divide, as the majority of Ugandans earn far below the mean, while a small fraction enjoys significantly higher earnings.
The report also notes that men generally earn more than women, while older citizens- benefiting from more employment and business opportunities – tend to earn more than younger people.
While Uganda’s economy has grown steadily, much of the labour force remains in low-productivity sectors, particularly subsistence farming and informal urban jobs. Agriculture remains the backbone of the country, employing 73% of the workforce, though only a small portion of farmers engage in high-value, commercial crops. In urban areas, workers in the informal sector often face challenges such as limited access to capital, workspace, and recognition from authorities.
Also, in 2022, the Bank of Uganda released a report that revealed the financial struggles many Ugandans still face. According to the Financial Capability Survey (FCS) 2020, half of Uganda’s working adults earned less than sh150,000 per month, with women more likely to fall in this low-income bracket than men.
Only 1% of adults earned more than sh1 million monthly. The survey, which covered 3,338 households, showed that six in ten adults were self-employed, mainly in agriculture, while business profits dominated as a key income source in urban areas. The findings highlight ongoing challenges in financial inclusion, as many Ugandans still lack enough disposable income.
The World Bank emphasises that creating jobs is vital for improving living standards and driving Uganda’s economic transformation. Despite the recent economic recovery, many Ugandans are not yet reaping the full benefits. Much of the economy is capital-intensive, providing fewer employment opportunities for the wider population.
The World Bank also highlights the need to boost productivity on farms and in urban businesses to create better jobs. The government must improve access to credit, implement better land policies, and build more efficient markets to support farmers. Urban enterprises, often overlooked, can play a major role in job creation and revenue generation with the right support.
Focusing on skills development, improving productivity across sectors, and addressing issues like land policies and infrastructure are crucial for Uganda’s growth. A more inclusive approach will help Uganda realise its vision of becoming a stable, integrated middle-income country.
