There Are Only Three Classes

I saw a Telegraph explainer on Britain’s “new social class system”¹, and it reminded me of reading the BBC’s Great British Class Survey from 2013. ²

I remember reading the BBC piece at the time and thinking its breakdowns missed the point. The Telegraph article gave me the same sense: these surveys overcomplicate class, confusing real economic divides with surface-level differences.

Income, savings, occupation, social networks, and cultural tastes all tell you something. They can tell you whether someone is secure, educated, well-connected, respected, isolated, precarious, or wealthy. The part I dislike the most is that if you work for a living, you’re anything other than working class.

That has always been my problem with “middle class” and all of the new variations of it they keep trying to introduce. It turns doing well into being above. It lets someone with a good salary, a clean job, and a decent house imagine they have escaped the working class, when in most cases, they have only made working-class life more comfortable.

If the salary stops and the mortgage becomes a problem, that person hasn’t escaped anything. They have a better seat in the same room. After that original 2013 BBC article, I spent some time thinking it through in depth and came up with a definition that stands the test of time. It is as true today as it was in 2013, and equally in 1713.

A Simpler Test

The real question is: What happens if you stop working.

There are three classes that matter.

The working class sells labour. That labour can be physical, technical, managerial, creative, emotional, professional, or boring. It can be paid by the hour, by salary, by invoice, by day rate, or by commission. The form doesn’t matter much. If survival depends on trading time or skill for money, that is working-class.

The merchant class organise labour and takes profit from it. That includes a shop owner with staff, an agency owner, a franchise holder, a small manufacturer, a subcontracting firm, or any business whose income continues while other people do the work. The owner may still work. They may work very hard. The distinction is that their income is no longer limited by their own labour. It continues even if they stop working.

The upper class lives on assets. That can mean land, property, inherited wealth, shares, trusts, or claims on capital. Their income comes from owning things that other people need, use, or rent. Owning an asset is not enough on its own. The asset has to carry the life.

These categories are blunt, but they explain more than the usual flattering language around class. They also map cleanly onto an older economic distinction: wages, profit, and rent. Adam Smith and David Ricardo used different terms, and they understood that income from labour, income from capital, and income from land are different relations.³

Modern class language usually adds polish and loses the mechanism.

What the Surveys Measure

The National Readership Survey social grades split people into A, B, C1, C2, D, and E. Higher managerial and professional workers sit near the top. Skilled manual workers sit below clerical workers. Semi-skilled workers, casual workers, and unemployed people sit lower again. NRS is open about what it does: it is an occupational classification used for readership, marketing, and audience segmentation.⁴

That is useful if someone wants to sell cars, newspapers, holidays, or insurance. It is much less useful if someone wants to understand power.

The ONS Socio-economic Classification is more serious. It considers employment relations, occupation, authority, security, and whether someone is an employer or self-employed.⁵ That gives it more analytical value than the old ABC1 shorthand.

Even so, the centre of gravity is still work-status. It can tell us that one employee has more autonomy or bargaining power than another. It can tell us that a consultant, a nurse, a warehouse worker, and a middle manager have different working lives. All of that matters. None of it changes the basic fact that they need earned income to live.

The Great British Class Survey went further and identified seven classes based on economic, social, and cultural capital: elite, established middle class, technical middle class, new affluent workers, emergent service workers, traditional working class, and precariat.⁶

The public story starts to annoy me here.

The survey found real divisions. It showed a wealthy elite at the top and a precarious group at the bottom. It also showed a lot of variation in the middle: people with good incomes but weak social networks, people with cultural capital but little money, and younger workers with energy and taste but not much security.

Fine, measure those things and study them, because they’re not meaningless.

These new labels can distract from economic reality. Terms like “technical middle class” and “new affluent worker” sound more precise, but mainly reflect different ways people participate in the workforce. Instead of clarifying someone’s relationship to power and income, these labels risk masking it with reassuring or status-focused language.

Those labels are soothing. They make people feel further away from the working class than their own bank account would suggest, especially after a few missed payments.

The Useful Lie

The phrase “middle class” survives because people want it to survive.

Politicians use it because it sounds aspirational. Advertisers use it because it helps them describe consumers. Employers benefit from it because it splits people who share the same dependency. Workers use it because nobody wants to think of themselves as a wage slave.

There is a difference between struggling on minimum wage and earning enough to save, take holidays, and have options. An engineer, a teacher, a plumber, and a delivery rider don’t all live the same life. Still, they belong to the same class as they rely on earned income.

They all still belong to the same class.

The middle-class label blurs the distinction that matters. It treats comfort as freedom and status as ownership. It treats being paid more as being on the other side of the table.

A person on 150,000 a year who needs that salary to keep the house is, in the important sense, closer to the person on 30,000 a year than to the landlord collecting rent from both of them. One has more room to manoeuvre. Both are dependent on labour income.

The buffer can matter. It can be the difference between inconvenience and disaster. In the UK, the FCA found in 2024 that one in ten adults had no cash savings, another 21% had less than 1,000 pounds available for emergencies, and one in four had low financial resilience.⁷ In the US, the Federal Reserve found that 63% of adults could cover a 400 dollar emergency with cash or its equivalent.⁸

Those figures are usually presented as financial resilience data, which they are. They also tell us something about class. Most people aren’t living from assets. They are living from wages with different amounts of padding.

Buying Labour

The merchant class is where this gets uncomfortable, because it includes people who may not feel rich or powerful.

A small business owner can have debt, stress, thin margins, and a payroll to meet. They can be ruined by one bad quarter. They can work longer hours than their employees. None of that is a contradiction.

Under my system, class is a description of how income is produced. This can and often does translate into higher standards of living, but mostly it translates into more security.

If a business owner pays people to work and keeps the surplus, they are in a different relation from the people selling that labour. The owner buys labour. The worker sells it. However friendly the workplace is, those interests don’t align.

There are edge cases. A self-employed electrician with no staff and no income when they stop working isn’t merchant class in any meaningful sense. They are selling skilled labour. A small owner who still has to work every shift may be partly worker and partly merchant. A business owner whose income continues while employees, contractors, and systems keep operating has crossed the line.

The test is whether their income depends primarily on their own labour or on other people’s. If they stop working, they keep eating.

Owning the Tollbooth

The upper class is easier to describe because the mechanism is cleaner.

They own assets that generate claims on other people’s income. Land is the oldest example, and in Britain it still matters enormously. HM Land Registry says land and property in England and Wales is worth nearly 9 trillion pounds, more than half the nation’s wealth.⁹ ONS wealth data shows property and private pensions dominating household wealth, while the least wealthy households have very little beyond physical possessions.¹⁰

Housing makes the whole thing visible.

The tenant pays rent from wages. The landlord receives rent because they own access to shelter. The landlord may have costs, taxes, repairs, and risk, but the class relation is still there. One side works to pay. The other side owns the thing being paid for.

Someone with one rental property who still needs their salary to keep their own home remains wage-dependent. While owning an asset provides greater security and a claim on someone else’s income, it does not eliminate the fundamental reliance on labour. Only when rent or asset income fully supports life, making work truly optional, does the class relationship distinctly change. This is the line that divides owning comfort from owning freedom, which is the real measure of class.

The English Private Landlord Survey 2024 gives the shape of it. 45% of landlords owned one rental property, representing 21% of tenancies. 17% owned five or more properties, representing 49% of tenancies. The same report found that landlords’ median total gross annual income was 52,000 pounds, with rent making up a median 50% of that income.¹¹

Housing isn’t only a living standards issue. It is class power. A person who owns scarce shelter has a claim on the labour of people who don’t.

Inheritance then keeps the whole arrangement alive. The Resolution Foundation found that 92% of outright homeowners expected to leave an inheritance, compared with 45% of renters. Among people expecting to leave an inheritance, 81% expected to pass on property assets.¹²

Work can improve a person’s position. Assets preserve a class position across generations.

What This Model Misses

I want the model to be crude because the polite versions hide too much.

It doesn’t say income is irrelevant. It doesn’t say that a doctor and a cleaner have the same bargaining power, security, choices, status, or daily experience. It doesn’t say managers can’t harm workers. It doesn’t say culture, education, race, gender, region, age, or disability vanish behind economics.

It says those things sit on top of the income relation rather than replacing it.

Pensioners are another edge case. A pension may be an asset in an accounting sense, but retirement doesn’t magically promote someone into the upper class. For most people, a pension is deferred wages and a bit of security after a working life. A retired nurse, electrician, teacher, or warehouse worker living from a pension hasn’t become a rentier because they are no longer on a rota.

A high earner who accumulates enough assets to live without working has changed class position. A salaried chief executive without meaningful ownership still sells labour, even if the price is obscene and the authority attached to it is large. A small employer whose business can’t survive without their daily work sits near a boundary. Boundaries exist because reality is messy.

Most of the newer class labels aren’t wrong because they measure nothing. They are wrong when they invite people to confuse lifestyle with power. A person can have education, a professional job, a good salary, and an expensive coffee machine, and still be one redundancy away from discovering exactly how working-class they are.

That is why I keep coming back to the same test.

If stopping work stops the life you have built, you are working class. If other people’s work keeps paying you, you are merchant class. If land, property, or capital can carry your life without work, you are upper class.

Everything else may be useful sociology. It may be useful marketing. It may even be useful self-description.

It doesn’t change the class relation.

If you have to keep selling your time to keep your home, you are working class. Better furniture doesn’t change that.