A European Socioeconomic Classification: How we got here and where we are going More info www'iser'e

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A European Socio-economic ClassificationHow we
got here and where we are goingMore info _at_
www.iser.essex.ac.uk/esec

• David Rose Eric Harrison
• Institute for Social and Economic Research
• University of Essex

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Eurostat Statistical Harmonisation Programme

• Aims to create a common set of
• core units
• core variables and
• core classifications
• for use in European and national social
  statistics

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ESeC

• Expert Group appointed by Eurostat in January
  2000
• Proposals for an ESeC made in 2001 Feasibility
  Report (see www.iser.essex.ac.uk/esec)
• This report forms the basis for the project

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Form of classification.

• The outline classification takes the form of a
  two-level nested hierarchy, similar to
  classifications such as the French PCS. In its
  disaggregated form (level 2, what we term
  Socio-economic Groups - SEGs) it covers the
  whole population at the individual level.
• There are SEGs to cover various other active
  and inactive groups. Individuals who are
  allocated to these groups on the basis of current
  status may then be allocated to ESeC classes in a
  variety of ways, depending partly on analytic
  purpose and partly on the group concerned.

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Possible ESeC Classes (Level 1)

• Large employers, higher managerial and
  professional occupations
• Lower managerial and professional occupations
• Intermediate occupations
• Small employers and own account workers
• Employers and self-employed in agriculture
• Lower supervisory and lower technician
  occupations
• Lower services etc occupations
• Lower technical occupations
• Routine occupations
• Never worked and long term unemployed

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Conceptual basis for the NS-SEC(Goldthorpe)

• Employment relations and conditions are central
  to delineating the structure of socio-economic
  positions in modern societies

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The Derivation of the NS-SEC
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Dimensions of work as sources of contractual
hazard
Specificity of human assets
high
Difficulty of monitoring
low
high
low
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Typical elements of the Labour Contract

• Short-term exchange of money for effort
• Payment by the time or piece
• No occupational pension or health scheme
• Contract easily terminated
• Low level of job security

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Typical elements of the Service Relationship

• Long-term exchange of service for compensation
• Greater job security and employability
• Salary
• Incremental or similar payment systems
• Occupational pension and health schemes
• Greater control over the job and thus trust
  between employer and employee

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Dimensions of work as sources of contractual
hazard, forms of contract and class locations
Specificity of human assets
high
1
6
Service relationship
mixed
Difficulty of monitoring
low
high
mixed
Labour contract
3
low
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The conceptual derivation of ESeC
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Underlying ESeC Socio-economic Groups (Level 2)
Class 1 Large employers, higher managerial and
professional occupations

• 11. Employers (other than in agriculture) with
  10 employees
• 12. Farmers with full-time employees (or large
  business farmers)
• 13. Higher managerial occupations
• 14. Higher professional occupations (employees)
• 15. Self-employed professional occupations

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Other active groups

• 01. Other unemployed
• 02. Unpaid family workers
• 03. National service

Inactive groups
04. Retired 05. Students (full-time) 06. Children
07. Permanently sick and disabled 08. Looking
after home
Not classifiable
00. Not classifiable (occupations not given or
inadequately described etc.)
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Classification rules for the individual level of
ESeC

• The other unemployed in SEG 01, unpaid family
  workers in SEG 02, national service personnel in
  SEG 03 and the inactive SEGs 04 - 08 do not
  immediately collapse to any class. Rather,
  individuals in these groups are (re-) allocated
  to the group of their career typical (usually
  last main) job or to their household class.

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Household level rules

• The household level of this classification would
  work in a similar way, except that the ESeC class
  position (level 1) would be allocated through a
  household class measure. In this case, those in
  SEGs 01-08 and 00 would be allocated to their
  household class.
• Equally, those allocated to SEGs 11-92 would take
  on the ESeC values of their household.

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Flexibility

• One of the advantages of a nested two-level
  schema such as this is that it will permit
  analysts to look inside classes. This will
  assist them in understanding how life-chances may
  vary between groups with the same employment
  relations. For example, do higher professionals
  in SEGs 14 and 15 have better health outcomes
  when compared with higher managers in SEG 13?

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Number of SEGs (1)

• As far as the number of SEG categories to be
  recognised within each class is concerned, this
  is partly an issue of face validity, i.e. of
  grouping together in sub-categories similar types
  of occupations that share similar employment
  relations.
• It should be noted that the SEGs within this
  outline classification are only postulated ones,
  designed to help illustrate how a possible
  two-level classification might work.

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Number of SEGs (2)

• However, it is the classes themselves that will
  need to be validated. Which SEGs we then wish to
  recognise within each class will be largely a
  matter of contingency, depending upon, for
  example, what might be useful for the internal
  analysis of classes, face validity issues, etc.
• The question of which SEGs exist, therefore,
  relates to which useful class sub-divisions we
  might wish to make among those combinations of
  occupation and employment status that share
  similar employment relations.

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Criterion validation of ESeC (1)

• We have a measure similar to ESeC that has
  already been created and validated using the
  method of collecting employment relations data at
  the level of occupations. This is the UK NS-SEC.
  We will also build on previous European research
  aimed at developing a comparative measure of
  social structure similar to ESeC, for example the
  Comparative Analysis of Social Mobility in
  Industrial Societies (CASMIN).

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Criterion validation of ESeC (2)

• Given the broad similarities of market economies
  and occupational and industrial structures across
  the EU, we can expect that employment relations
  will also be similar. Thus, it is reasonable to
  begin by creating an ESeC derivation matrix with
  cell values based on UK employment relations
  data. These data were collected in the 1996/97
  winter quarter of the LFS.

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What we have to do

• We have constructed a derivation matrix on the
  basis of the best available evidence we have on
  the employment conditions typical for the
  occupational unit groups of ISCO88(COM). This
  evidence was drawn from work for the project that
  produced the UK National Statistics
  Social-economic Classification (NS-SEC), as well
  as from earlier work on social mobility by
  Erikson, Goldthorpe and their colleagues and more
  recent work by academics on employment relations
  in Europe. In addition, the matrix is now being
  examined by NSIs, partners in the project and
  other nominated academic experts.

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Constructing ESeC

• In order for an ESeC to be fully operationalized
  in line with our theoretical model, at a minimum
  we require measures of occupation, status in
  employment and, in some cases, enterprise size.
  We also believe that labour market position
  should be part of what an ESeC measures. In
  addition, some measure of farm size may be
  necessary, too, in order to distinguish
  capitalist farmers from other (e.g. subsistence)
  farmers. How, precisely, are these common
  elements to be measured? Do all the datasets we
  intend to use have these measures in the form
  required?

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Occupation

• For the most part occupation is measured either
  by (4-digit) ISCO88(COM) or by a national
  occupational classification similar to it. France
  is exceptional in this regard, but has developed
  a Table des Correspondances between the
  Catégories Socioprofessionnelles (CSP) and
  ISCO88(COM). ISCO88(COM) is a core variable for
  the Eurostat harmonisation programme and so is
  the obvious measure of occupation to use for ESeC.

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Status in employment

• All SECs distinguish between employers, the
  self-employed (own account workers) and
  employees. In the EU context, we may need to add
  the category of family worker. The EU harmonised
  variable is ICSE-93.

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ICSE-93

• Employees
• Employers
• Own account workers
• Members of producers co-operatives
• Contributing family workers
• Workers not classifiable by status

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Labour market position

• It is necessary to distinguish more than activity
  status. Our theoretical model requires us to
  discriminate between employers by size, the
  self-employed, and between managers (by size of
  enterprise or preferably managerial level),
  supervisors and other employees. Managerial
  status will be dependent on allocation to Major
  Group 1 of ISCO88(COM). Thus, labour market
  position involves a combination of ICSE-93,
  enterprise size and supervisory status.

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Number of employees
The size cut-off for enterprise size in the
non-agricultural sector varies across the
national SECs 1-9, 10 1-24, 25 1-49, 50 or
combinations of these. However, since ISCO88(COM)
is the harmonised occupational classification,
then the initial simple rule for ESeC will need
to be that employed by ISCO for managers and
employers 1-9 and 10.
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Example illustration of parts of the ESeC
derivation matrix
Note in this table, for simplicitys sake, we
assume a seven-category empstat (i.e. that farm
can be established via ISCO).
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Reduced ESeC

• Some data sets may not contain all the elements
  required to create ESeC in the prescribed manner.
  However, it would also be possible to produce a
  reduced form of ESeC for use where data on
  establishment size are not given. Naturally, the
  costs and benefits of this would have to be
  assessed for each member state. The reduced form
  could be derived in essentially the same way as
  the full form of ESeC, except that (ignoring the
  agricultural sector again) the employment status
  variable would only have five categories
• 1. Self-employed with employees
• 2. Self-employed with no employees
• 3. Manager
• 4. Supervisor
• 5. Employee
• The ESeC category for self-employed with
  employees and for managers would be based on the
  modal employment status category for each
  occupation.

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Simplified ESeC

• The simplified form of ESeC would be for data
  sets in which only information on occupation
  (i.e. on 4 digit ISCO OUG) is available. The
  primary rule would be that occupations (OUGs) are
  allocated to the ESeC category for other
  employees, except where these are in a minority
  within that occupation or an occupation has no
  other employee status (e.g. managers). In these
  cases the ESeC category of the modal occupation
  by employment status combination would be used.
  Hence, for example, if within a particular OUG
  supervisory status predominates, then the ESeC
  value for supervisors in that OUG will apply.

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Next Steps

• Create derivation matrices done
• Matrices report to partners, NSIs, Eurostat and
  experts for responses - done
• Statistical Compendium being undertaken
• Validation studies May to November 2005
• Validation conference January 2006
• ESeC User Guide mid 2006
• NSIs Workshop mid 2006