Socioeconomic status refers to a person’s position in the social hierarchy, as determined by a combination of economic and social factors.
Examples of things that make up a person’s socioeconomic status include the amount and type of education the person has, their income, their type of occupation, and their area of residence.
In some societies such as caste societies, the person’s position is also determined by a range of religious background or ethnic origin.
Sometimes, socioeconomic status is also seen as the amount of financial stress or the ability to balance income with the available expenses (American Psychological Association, 2010).
Definition of socioeconomic status
Socioeconomic status (SES) is a combined measure of a person’s or family’s social and economic position in relation to others in the community (Baker, 2014).
SES is usually broken into three categories:
- High socioeconomic status (often correlating with upper-class)
- Middle socioeconomic status (often correlating with middle-class)
- Low socioeconomic status (often correlating with working-class and poor)
When categorizing families or individuals, the three most considered variables include:
There is a clear relationship between economic inequalities and the health of populations (Glymour et al, 2014). In other words, socioeconomic disadvantage is a social determinant of health. Low education and income have been associated with a range of mental and physical health issues such as arthritis, respiratory viruses, and coronary disease.
Socioeconomic Status Examples
The following are factors affecting socioeconomic status according Calixto and Anaya (2014), Brown et al (2001), and Braveman et al (2005).
- The family’s or individual income
- The education level
- The occupation type and level
- Community safety (evaluated based o the number of violent crimes and injury deaths in the surrounding community)
- Family and social support (e.g. social capital, which enables the enjoyment of social opportunities)
- Wealth possessed by the individual or family
- Access to quality healthcare
- Access to proper nutrition
- Access to food security
- Working life conditions for the employed people
- The availability of quality housing
Key SES Factors
1. The family’s or individual income
Income refers to profits, wages, salaries, rents, and other income flows. Income can also be generated from social security, workers’ compensation, dividends, and interests, or other public, family, or government financial assistance (Stone et al, 2015).
Income can also come from lotteries and monetary winnings in competitions where money is the final award. Household income is deemed the general measure of a family’s well-being.
There should be a balance between family expenditure and income level to ensure healthy living where a family or an individual is able to afford all the required goods and services without having to strain.
Since income is relatively easy to figure out between various individuals, it is deemed a very important factor in determining the socioeconomic status of various people in the community.
Income inequality is common in the community and the difference is vivid. Low-income families focus on meeting basic needs and not accumulating wealth for future generations.
Families and individuals with higher incomes can focus on meeting the required needs as well as accumulating wealth while still enjoying luxurious lifestyles (Stone et al, 2015).
2. The education level
Education is a key contributor to individual skills and the enhancement of human capital. It is an important factor that determines the amount of income earned by an individual.
Earnings tend to increase with educational level. The highest professional and doctoral degree holders earn the highest weekly and monthly wages compared to others with less levels of formal education.
Higher education levels are associated with better psychological and economic outcomes such as networking, greater social support, more income, and more control.
Education is not only important for improving people’s living standards but also strengthens individuals’ developmental capacities (Lee et al, 2003).
3. The occupation type and level
The prestige of an occupation is often linked to education level and income, but is also linked to the perceived value of the profession to society.
Jobs that are categorized in the higher SES (often, white-collar jobs) include surgeons and physicians, engineers, communication analysts, and professors. These occupations are deemed more challenging requiring competency and more ability to meet the job objectives.
Jobs with low rankings (often, blue-collar jobs) include bartenders and helpers, janitors, dish-washers, counter attendants, parking lot attendants, housekeepers, and vehicle cleaners among others. These jobs offer lower wages and tend to be less valued, more laborious, and sometimes associated with hazardous working conditions (Stone et al, 2015).
4. Access to quality healthcare
The SES ladder tends to significantly correlate with healthcare outomces in the community. Disadvantaged populations such as the poor, rural residents, and the less educated are more affected by poor access to healthcare than their richer counterparts in the urban areas.
Individuals in higher social positions enjoy better health than those in lower ones. Low education and income levels have been associated with poor mental and physical health.
These health problems may result from poor working environment, high levels of stress, failure to access quality healthcare, poor nutrition, and food scarcity (Braveman et al, 2005).
5. Wealth possessed by the individual or family
High SES people tend to have higher wealth, intergenerational wealth, and more ownership of income-generating assets. Lower SES people tend to live with less economic reserves, leading to financial stress.
Predictors of wealth attainment include family size, income, occupation, marital status, and education. Small and highly-educated family groups tend to have higher wealth than single-parent families, larger families, or families where the parents are in blue-collar work.
The wealth gap is very common just like the income inequalities. Wealthy people are deemed to hold higher positions in the community and tend to be involved in higher-level community decision-making processes as they are seen as powerful community members (Fraser et al, 2006).
socioeconomic Status vs Social Class
In sociology, we engage with both socioeconomic status and social class. Whereas socioeconomic status refers to generally economic factors and how they affect a person’s social status, class theorists explore cultures within different tiers of society.
Of course, the two terms overlap significantly. For example, working-class people tend to be of low socio-economic status.
However, when discussing working-class people, we’re also including cultural and subcultural factors in the discussion. Often, in class analysis, you will hear of concepts like social and cultural capital included in the analysis.
For example, upper-class culture often involves a taste for fine foods, expensive services, and elite sports that lower-middle class and lower-class people tend to disregard.
Similarly, many sociologists have explored how working-class culture values a more rugged form of masculinity than other social classes, where the ability to work hard and have street smarts is more valuable than educational attainment or renaissance man characteristics.
Socioeconomic status refers to the position an individual or a group holds in the community which can be termed as high, medium, or low.
The status is determined by various factors such as education level, occupation, income, wealth, access to healthcare, and social and family protection among others. The status can be determined on a personal or family level where a family or an individual is compared to others in the community.
Socioeconomic status is associated with greater inequalities in the community including access to quality healthcare, education, and developmental opportunities. People with higher socioeconomic status are seen as the lucky ones in society who have to live a respected life without many struggles.
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Lee, S., Kawachi, I., Berkman, L. F., & Grodstein, F. (2003). Education, other socioeconomic indicators, and cognitive function. American journal of epidemiology, 157(8), 712-720.
Stone, C., Trisi, D., Sherman, A., & Debot, B. (2015). A guide to statistics on historical trends in income inequality. Center on Budget and Policy Priorities, 26, 1-23.
Szromek, A. R., & Wolniak, R. (2020). Job satisfaction and problems among academic staff in higher education. Sustainability, 12(12), 4865.
Dr. Chris Drew is the founder of the Helpful Professor. He holds a PhD in education and has published over 20 articles in scholarly journals. He is the former editor of the Journal of Learning Development in Higher Education. [Image Descriptor: Photo of Chris]