1. European Socioeconomic Groups (ESeG) Agenda point 8
DSS Meeting September 2014

2. Background
The ESeG classification was developed by an ESSnet composed by the National Statistical Institutes (FR, CZ, IT, HU)
The classification is fully derived from “Core social variables”.
The work of this ESSnet was presented to the following working groups:
Labour Market,
Social conditions and
Classifications
Comments were requested from the Classification Working Group and the classification was slightly revised to include the amendments requested.

3. Purpose of the classification
The ESeG classification is a tool to measure the social status, which indicates the status of an individual (or of a household) in the stratification system of societies.
This classification aims to facilitate the comparative analysis of many aspects of the quality of life and of social cohesion, for example health, living conditions and economic situation of European Union’s population, seeking to understand variation between member states.
It should also provide a comparative research tool to facilitate analyses of intergenerational social mobility and the intergenerational inheritance of inequalities.

4. Basic principles of the classification (1)
ESeG is a derived classification based on the following core social variables:
“Status in employment”
“Occupation in employment”
“Age” and “Self-declared labour status” are also used to differentiate Groups 1-7 from 8-9.
The classification is composed by 9 groups (1-9) and 42 sub-groups.
Groups 1 to 7 refer to the active population (Labour Status = employed or unemployed).
Groups 8 and 9 refer to the inactive population. Group 8 concerns the inactive population 65 years or older and Group 9 refers to those aged less than 65.

5. Basic principles of the classification (2)
The employed population is classified according to ESeG using Occupation (ISCO 08 sub-major groups) and Status in employment (Self-employed/employees). Family workers should be considered in this context as self-employed.
The unemployed population should be classified in a similar way but using occupation and status in employment of previous job. When this information is not available they should be coded in ESEG 9.3.

6. Basic principles of the classification (3)
Under Group 8 the individuals are classified according to the occupation and status in employment of their last job.
When the person has never worked or the information on his/her last job is not available sub-group “8.9 Other persons outside the labour force aged 65 or more” should be used.
Persons aged 65 or over still working should be classified in groups 1-7 according to their job.
Group 9 should be used for non-employed persons aged less than 65. The subgroups proposed can be used with the help of the variable Self-declared labour status.
Students or disabled with an employment should be classified in groups 1-7 according to their job.

7. Treatment of non-response
The classification can only be derived when the information on the component variables is available.
The individual socio-economic status is strongly influenced by the socio-economic status of the household he/she belongs. Therefore in case of missing information for main variables for an individual, their household status could be used as proxy.
In the future a more sophisticated method of imputation can be analysed and tested.

8. Limitations and design constraints
Non exhaustive classification for non-employed persons: Information on previous job is not always available.
Relevance of the variable Employment status: ESeG classification relies fundamentally on a clear distinction between employees and self-employed but it can happen that these concepts will be reviewed in the light of the revision of ICSE classification
ILO status and Self-declared status: The intervention of the ‘self-perceived situation’ (Self-declared labour status) in the calculation of ESeG could be controversial and could drive to problems of harmonization as this variable has a very different nature from the ILO labour status

9. Treatment of household level data
This classification aims to classify individuals.
However, many phenomena concerning economic, social and cultural characteristics are linked with households and the socio-economic position of individuals can be influenced by the composition of their household.
It would be important to define the socio-economic status of the household and to establish rules describing more precisely how the ESeG-code of a household can be derived from the ESeG-codes of the individual members.

10. Amendments proposed by the Classification Working Group
ISCO 92 (Agricultural, forestry and fishery labourers) and Status of employment “employee” are coded in ESeG 7.4 instead than 7.2
ISCO 92 (Agricultural, forestry and fishery labourers) and Status of employment “self employed” are coded in ESeG 4.1 instead of 4.3* [Please note: code 4.4 in the document is a typo]
Following the recommendations of the UN expert group on classifications, residual/other categories should be coded using 9. For this reason the following changes were applied:
“Other persons outside the labour force aged 65 or more” are coded in ESeG 8.9 instead than 8.8
“Other persons outside the labour force aged less than 65 years” are coded in ESeG 9.9 instead than 9.4.

11. Next steps
Eurostat will study the possibility to use the new classification European Socio-economic Groups (ESeG) for the dissemination of some relevant social statistics. Project managers of LFS and EU-SILC domains will identify a limited number of relevant thematic tables to be disseminated as an output test in the Eurostat database.
A Task Force with a short term mandate composed by Member States willing to study methodological aspects and the pending issues linked with the implementation of the classification might be launched.

12. Mandate and modus operandi of the Task Force
The Task Force should:
Study and test a method of imputation of the missing component variables
Analyse the impact of the limitations and constraints mentioned before.
Establish rules describing how the ESeG-code of a household can be derived from the ESeG-codes of the individual members
Review and make proposals on the tables to be disseminated according to ESeG.
The Task Force will be coordinated by Eurostat (Unit F1) and is expected to work virtually. A single meeting to conclude the work of the Task Force is expected to take place by June 2015.