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Indian Industry

Socio-Economic Classification

In addition to income classification and consumer classification, Indian households can also be segmented according to the occupation and education levels of the chief earner of the household (the person who contributes most to the household expenses). This is called as Socio-Economic Classification (SEC), which is mainly used by market planners to target market before launching their new products. SEC is made to understand the purchase behavior and the consumption pattern of the households.
The urban area is segregated into: A1, A2, B1, B2, C, D, E1, E2.
Socio-Economic Classification

Occupation

Education

Illiterate

Less than 4 yrs in school

5-9 yrs of school

School certificate

Some college

Graduate

Post-graduate

Skilled

E2

E1

D

C

C

B2

B2

Unskilled

E2

E2

E1

D

D

D

D

Shop owner

D

D

C

B2

B2

A2

A2

Petty trader

E2

D

D

C

C

B2

B2

Employer of-

Above 10 persons

B1

B1

A2

A2

A1

A1

A1

Below 10 persons

C

B2

B2

B1

A2

A1

A1

None

D

C

B2

B1

A2

A1

A1

Clerk

D

D

D

C

B2

B1

B1

Supervisor

D

D

C

C

B2

B1

A2

Professional

D

D

D

B2

B1

A2

A1

Senior executive

B1

B1

B1

B1

A2

A1

A1

Junior executive

C

C

C

B2

B1

A2

A2


Source: Indian readership survey (IRS)

Sections A & B refer to High-class- constitutes over a quarter of urban population
Sec C refers to Middle-class-- constitutes 21% of the urban population
Sections D & E refer to Low-class-- constitutes over half the urban population

To understand the table, consider an example: A trader whose monthly household income (MHI) is more than that of a person in section A cannot be included in this SEC because his educational qualification or occupation do not qualify him for inclusion.

Sec C constitutes households whose Chief Wage Earners are employed as :

Skilled workers

33%

Petty traders

12%

Clerk/Supervisor

37%

Shop owners

18%



3/4th of them have studied till 10th or 12th class while the remaining 1/4th have studied till 9th class.
Less than half of the Chief Wage Earners of households belonging to sections D & E are unskilled workers. Petty Traders are 18%, while Skilled Workers are about 28%.

More than 80% of the population of upper strata consumers is living in the top 7 cities. Those top 7 cities are Mumbai, Kolkata, Delhi, Chennai, Ahmedabad, Bangalore, and Hyderabad. With increase in economic prosperity, this population (upper strata consumers) is growing at 10 percent annually.

The rural area is segregated in to: R1, R2, R3, R4.


Education of chief wage earner Type of House

 

Pucca

Semi-pucca

Kuchcha

Professional degree

R1

R2

R3

Graduation/ PG

R1

R2

R3

College

R1

R2

R3

SSC/HSC

R2

R3

R3

Class 4-Class 9

R3

R3

R4

Up to class 4

R3

R3

R4

Self-learning

R3

R4

R4

Illiterate

R4

R4

R4




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