The traditional way of thinking goes: if you’ve got a good job, you’re more or less set for life.
But in Australia today, it’s whether or not you own property that decides and determines people’s life chances, University of Sydney researchers argue in a new paper.
Social class is being determined more by one’s assets than their wages, the researchers said in the Class in the 21st century: Asset inflation and the new logic of inequality paper.
“It used to be that if you had a better job, you’d more likely be better off,” says University of Sydney faculty of arts and social sciences professor Lisa Adkins.
“Now we’re in a new socio-economic phase favouring asset ownership.”
Related story: 7 facts you need to know about Australia’s property market
We have to throw the old model behind, she added.
“In the present era, where mid-size homes in large Western cities often appreciate by far more in a given year than it is possible for middle-class wage-earners to save from wages, such a continued focus on employment as the main determinant of class is increasingly untenable.”
Take Sydney, a city where dramatic property price growth has contrasted with stagnant wages.
“This property inflation cannot be seen as just a speculative bubble, or a result of poor policymaking,” Adkins said.
“Yes, it may be those things in part, but it is also a structural feature of the current phase of capitalism and has been central to the production of a new social structure of class and stratification that is characterised by a logic of its own.”
Take a look at the new class structure the researchers developed, based on asset ownership:
Owning property creates income streams
As the workforce becomes more casualised, those who have a house or a car are able to create a source of income out of their assets.
For example, those who have cars become Uber drivers, and those who own homes can rent out their rooms or list them on Airbnb, creating an environment of asset-haves and asset have-nots.
The economy therefore needs to be thought of in a new way, the researchers argued.
“That’s why we have to leave that old model behind,” Professor Adkins said.
“And the best way to do that is to help people recognise and understand what’s happening by thinking about the economy in new ways.”
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