Occupational Percentile Rank: A New Method for Constructing a Socioeconomic Index of Occupational Status
Sociological Methods & Research, 54(2): 355–396.
In this paper, we propose a method for constructing an occupation-based socioeconomic index that can easily incorporate changes in occupational structure. The resulting index is the occupational percentile rank for a given cohort, based on contemporaneous information pertaining to educational composition and the number of workers at the occupation level. An occupation may experience an increase or decrease in its occupational rank due to changes in relative sizes and educational compositions across occupations. The method is flexible in dealing with changes in occupational and educational measurements over time. Applying the method to U.S. history from the mid-nineteenth century to the present day, we derive the index using IPUMS U.S. Census microdata from 1850 to 2000 and the American Community Surveys (ACSs) from 2001 to 2018. Compared to previous occupational measures, this new measure takes into account occupational status evolvement caused by long-term secular changes in occupational size and educational composition. The resulting percentile rank measure can be easily merged with social surveys and administrative data that include occupational measures based on the U.S. Census occupation codes and crosswalks.
Occupational Measures: Historical Perspective
While commonly used, occupation is among the most challenging and least agreed-upon measures in surveys and population registers. An “occupation” refers to the aggregation of inherently different jobs that are sufficiently similar with respect to requirements, duties, and responsibilities so as to be categorized together for statistical purposes. In the United States, occupation was first enumerated in the 1820 full-count Census, on the basis of families, rather than individuals. Each occupation in the U.S. Census Bureau’s classification system is an aggregation of more detailed occupational titles, which are in turn based on respondents’ descriptions of job titles and/or types of work. One issue with these categorical approaches is their high degree of aggregation—workers within a large category are all assumed to be relatively homogeneous, or at least interchangeable. To modify this assumption of strong homogeneity, Grusky, Weeden, and their collaborators developed a microclass occupational scheme and applied it to the study of occupational segregation, social mobility, and inequality. Alternatively, researchers have converted original occupational categories into scalar measures of occupational status. One well-known example is Duncan’s (1961) socioeconomic index, discussed below, which is a weighted average of occupational education and occupational income. It is not our intention to evaluate the relative merits of many earlier approaches, as there are advantages and disadvantages associated with each. Judicious choices should be made within a concrete research context to meet particular theoretical, methodological, and practical needs. Instead, we propose a relative occupational measure, a version of the scalar approach, and show that our measure has several advantages over other existing alternatives, especially in its ease of use and interpretability in comparing occupations cross-nationally or across time.
Socioeconomic Status Indexes and Scales: An Overview
Scalar measures of socioeconomic status rest on the assumption that the vertical status hierarchy of different occupations can be characterized by a single, latent, continuous scale. It is important to recognize that, being latent, a scalar measure always needs to be normalized with two constraints: Location and scale. Previous continuous occupational measures fall into three categories: Occupational prestige, socioeconomic index, and percentile scores. We highlight significant developments in each of these categories below
Occupational Prestige: Occupational prestige, the extent of social deference or derogation conferred to incumbents of an occupation, was one of the earliest and remains one of the most widely used indicators of social standing. Measurements of occupational prestige typically rely on subjective evaluations of occupations by either population-representative or well-informed respondents.
Socioeconomic Indexes: In 1961, Otis Dudley Duncan published his work on “a socioeconomic index for all occupations,” the Duncan Socioeconomic Index (hereafter, the Duncan SEI), which quickly became the most popular continuous occupational status measure. The main difference between prestige scores and socioeconomic indexes like the Duncan SEI is that the latter are composites based on objective indicators at the occupation level and thus do not require data on personal evaluations of occupations. Specifically, the Duncan SEI is a weighted sum of the average education and average income of incumbents within an occupation. Socioeconomic indexes are attractive because they generalize surveybased prestige ratings for a small set of occupations to a wider range of occupations based on occupation-level objective attributes. Yet, as Duncan (1961) noted, the two objective characteristics, i.e., occupational income and occupational education, are not the only social determinants of prestige ratings. Other factors may also influence individuals’ judgment of prestige values. Hollingshead (1949, 1957, 1975) and Hollingshead and Redlich (1958) developed the ISP based on two or more social factors related to educational attainment, occupation, quality of the neighborhood of residence, marital status, and sex, sometimes also known as the Hollingshead Two-Factor, Three-Factor, and Four-Factor indexes.
Percentile Scores: In a series of papers, Nam and Powers (1968, 1983) and Nam and Boyd (2004) developed an occupational percentile score measure to capture substantial changes in occupational statuses based on Census occupational categories. The rationale behind this measure is that high-status occupations have grown, in both number and size, over time, whereas lowstatus occupations have shrunk. Nam and Powers (1983:127–142) first sorted occupations according to the educational level of men over 14 years old in the civilian labor force for the 1970 Census data. They then derived the education-based distribution by accumulating the proportion of workers employed in each occupation from the lowest-educated occupation to the highest-educated occupation.
Index of Job Desirability: A potential limitation of previous occupational status measures is that they do not reflect desirability of jobs. The Index of Job Desirability (IJD) that intends to measure all three dimensions of inequality: Class, status, and power. In practice, the index combines 13 non-monetary job characteristics with occupational earnings and weighs the relative importance of these characteristics in a score that varies between 41 and 689
IPUMS Occupational Scores: IPUMS recently released its (1) occupational education score, (2) occupational income score, and (3) occupational earnings score using 1950 and 1990 Census occupational coding systems.
Limitations of Previous Occupational Indexes
From the very beginning of social stratification research, scholars have been concerned with the comparability of occupations across time or generation. Occupations evolve, in ways big or small, in response to economic changes, with the emergence of new occupations and the obsolescence of old ones. In recent decades, many of these changes were driven by the influx of new technologies, educational upgrading, occupational licensing, and the restructuring of the local labor market due to globalization and offshoring. As a result, the relative socioeconomic standing of the same occupation may vary over time as the overall occupational structure evolves, presenting challenges for studies of intergenerational mobility. For example, if parents and offspring stay in the same occupation, but the relative status of the occupation itself changes, should we consider such a scenario as exemplifying intergenerational mobility or immobility?
Building on previous work, we develop an occupational measure for relative occupational status over long periods of time or even across multiple generations. Substantial changes in occupational status occur not only because of the increasing diversity of work or the changing nature of activities under the same occupational titles but also because of historical changes in the proportions of workers employed in different occupations.
To account for occupational restructuring over time, we construct an occupational percentile measure for each birth cohort, assigning possibly different status scores to workers in the same occupation but who entered it at varying times.