The class ceiling in the United States: class-origin pay penalties in higher professional and managerial occupations

Daniel Laurison and Sam Friedman

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Gender and racial pay penalties are well-known: women (of all races) and people of color (of all genders) earn less, on average, even when they gain access to occupations historically reserved for White men. Studies of social mobility show that people from working-class backgrounds in the US have also been excluded from top professional and managerial occupations. But do working-class-origin people who attain top US jobs face a class-origin pay penalty? Despite evidence of class-origin pay gaps in higher professional and managerial occupations elsewhere, we might expect that the central role of race and racism in US stratification processes, along with the relatively low salience of class identities, would render class origins irrelevant to earnings in exclusive occupations, at least within racial groups. Using the Panel Study of Income Dynamics to link childhood class position to adult occupation and earnings, we describe the racial and class-origin composition of different high-status occupations and the earnings of people within them. We show that when people who are from working-class backgrounds are upwardly mobile into high-status occupations, they earn almost $20,000 per year less, on average, than individuals who are themselves from privileged backgrounds. The difference is partly explained by the upwardly mobile being less likely to have college degrees, but it remains substantial (around $11,700) even after accounting for education, race and other important predictors of earnings. The gap is largest among White people; there is a class-origin penalty in top US occupations that is distinct from the racial pay gap.

JEL-codes: J01 R14 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2024-09-01
New Economics Papers: this item is included in nep-mid
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Published in Social Forces, 1, September, 2024, 103(1), pp. 22 - 44. ISSN: 0037-7732

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