MRG Evening Meeting – The National Statistics Socio-Economic Classification
A new government social classification scheme for the twenty-first century has been unveiled in a report from the Office for National Statistics and the Economic and Social Research Council. The new scheme, to be called the National Statistics Socio-Economic Classification (NSSEC), will replace the current government social classifications, Social Class based on Occupation (SC – formerly Registrar General’s Social Class) and Socio-economic Groups (SEG), from 2001.
Based on the widely-used social class scheme devised by Oxford sociologist John Goldthorpe, the NSSEC has been developed over the last three years by a team of social scientists appointed by ESRC and led by Professors David Lockwood and David Rose of the University of Essex’s Institute of Social and Economic Research (home to the British Household Panel Study) and Jean Martin, Director of Methodology in the ONS Survey Division.
The NSSEC is more rigorously based conceptually than either the current government schemes or MRS Social Grade and has been subjected to a full programme of validation. Because NSSEC has a clear basis as a measure of employment positions, researchers who use it will be better able to explore the relations between socio-economic position and various forms of behaviour and outcomes.
Conceptually the NSSEC distinguishes four basic employment positions – employers, the self-employed, employees and those involuntarily excluded from paid employment. Within the category of employers, a further distinction is made between large and small employers according to the number of employees in the organisation. Employees are sub-divided into classes according to the type of contract they have with their employer. Two basic contract types are distinguished – the labour contract and the service relationship.
Labour contracts involve a relatively short-term and specific exchange between employers and employees of money (a wage) for effort. This is the situation which pertains for the whole working class, although its most basic form is found in the case of routine occupations in class 7 (see column three of the table). The service relationship, however, is typical for managerial, professional and senior administrative positions, and its basic form is found in class 1. This form of contract involves a longer-term and more diffuse exchange in which employees render service in return for both immediate and future compensation (a salary, regular pay reviews, perks of various types, a career, generous pension schemes etc.). Other types of employee, for example clerical and technical workers in class 3, are defined as intermediate in terms of employment regulation, having contracts with elements of both the service relationship and the labour contract.
The excluded comprise those who have never worked but would wish to, and the long-term unemployed. However, other non-employed persons, such as those who look after the home, the retired, the short-term unemployed, the sick and disabled, etc., are classified according to their last main occupation. Full-time students can also be treated similarly if required. In this way, and like MRS Social Grade, it is possible to classify most of the adult population within the NSSEC. As the table shows, the NSSEC has a long version with seventeen groups, similar to SEG. However, the principal purpose of this long version is to allow researchers to bridge between NSSEC and the current classifications – NSSEC does not have seventeen classes, as recently reported in the press. Fourteen of the seventeen groups may then be collapsed into 9, 8, 5 and 3 category class schemes. The other three groups are residual.
ONS has decided to recommend the 8-class version for use in government, although some government datasets will not allow the creation of category 8. In such cases the long-term unemployed will be assigned to the class of last main job and the never worked will be excluded.
Conceptual clarity is not the only virtue of NSSEC. It has also been fully validated in a rigorous testing programme. NSSEC has thus been demonstrated to be a sound measure of employment relations, which maximises between-class and minimises within-class variation. In addition, it has been shown to be a good discriminator in terms of earnings, unemployment experience and duration, smoking behaviour, morbidity, mortality and subjective health. The separation of the self-employed and small employers into a category of their own has already raised new issues for health and opinion researchers to explore. Judicious use of the flexibility offered by the scheme, especially if the long version is used to ‘look inside’ the main classes, can also give rise to new insights into old problems.
Now that the NSSEC has been developed, discussions will be held with interested parties in market and media research about its suitability as the basis for a revised Social Grade scheme. The latter was devised by Mark Abrams on the basis of the old Registrar General’s Social Class scheme; and it is hoped that NSSEC might be similarly adaptable for use in market research. Given that the NSSEC has a proven method for classifying the non-employed population, and that it can be derived from data on occupation alone, the prospects would seem good. However, Professor Rose pointed out that this new system may not initially be of greater benefit to marketers than the current ABC1 classifications. Both systems might be used in tandem to examine different areas or aspects of the population, he suggested.
NSSEC will not be in its absolutely final form until June 2000. Time is being allowed for testing and refinement of the scheme, followed by its re-basing on the revised occupational classification – SOC 2000.
To facilitate the testing programme, ONS will soon be publishing a NSSEC user manual which both explains the scheme and provides access to an electronic version of the necessary look-up tables allowing it to be operationalised.
Commenting on NSSEC, Professor Rose said: “We have produced a classification which is both clear and rigorous conceptually, properly validated and simple to create. Through both its hierarchical properties and its variants, it is very flexible in use. It offers a high level of continuity with SC and SEG, but gives improved population coverage, as well as being a better classification for both women and the self-employed. Since NSSEC also lends itself to the explanation of relationships, we hope that it will become a standard tool for researchers in government, universities and the private sector”.
Along with Professor Peter Elias (Institute of Employment Research, University of Warwick), who is currently working on the revision of SOC, Professor Rose will be discussing the NSSEC at the MRS Conference in March. Work is also about to begin on the development of another variant of NSSEC for possible use throughout the European Union. This version will be based on the EU’s adaptation of the International Standard Occupational Classification.