4.2.8 - Globalisation and Changes in the Class Structure

Globalisation and class change

Globalisation refers to the growing interconnectedness of economies, politics, and cultures across national borders. In stratification, this matters because class structures are shaped by where capital moves, where jobs are located, and which groups are protected or exposed when firms, states, and workers are pulled into global competition.

Sociologists usually divide globalisation into three linked dimensions. Economic globalisation involves the movement of capital, goods, and production across borders. Political globalisation refers to the growing influence of supranational organisations and agreements on national decision-making. Cultural globalisation involves the spread of media, brands, lifestyles, and ideas. These dimensions do not affect all groups equally. They reshape the class structure by changing which kinds of work are valued and which communities are left behind.

In the UK, one major effect has been deindustrialisation. Manufacturing jobs that once supported relatively stable working-class communities have declined, while employment has expanded in services such as retail, logistics, hospitality, care, finance, and digital platforms. That does not mean "class disappears". It means class is reorganised. Secure, unionised manual work has often been replaced by more fragmented and insecure employment, while highly paid professional and managerial jobs linked to finance, technology, and global business have grown.

Guy Standing argues that one result is the growth of the precariat: workers living with insecure hours, weak employment rights, and uncertain futures. This is important because insecurity becomes a class experience in its own right. Globalisation does not simply create a richer world; it also creates a labour market divided between those with mobile skills and protection, and those whose labour is cheap and easily replaced.

That is why sociologists treat globalisation as a class issue rather than just an economic trend. It changes life chances, bargaining power, and the resources different groups can pass on to their children.

Job relocation and employment security

Mobile capital can move production and investment between places. This changes local employment opportunities: an industrial community may lose stable jobs while another region gains production. The consequences depend on the work that replaces the old jobs, not only on how many people remain employed.

Deindustrialisation changes the balance between manufacturing and service work. Some service jobs are well-paid and secure; others rely on agency contracts or irregular hours. Insecure contracts restrict planning, bargaining power and access to stable housing. Globalisation can therefore reorganise class inequality through job location, occupational change and employment security, even when class labels become less familiar.

Global inequality and TNC power

Globalisation also changes inequality on a world scale. Some regions and classes gain from growth, while others face stagnation, dependency, or exploitation. A useful starting point is the work of Branko Milanovic (2016), who used large-scale income data, including Lakner and Milanovic’s 1988–2008 comparisons, to show uneven historical gains. The well-known "elephant curve" describes income changes associated with the era of globalisation rather than proving globalisation alone caused them. It suggests that some middle-income groups in rapidly developing countries experienced major income growth, while the very richest also gained strongly. By contrast, parts of the working and lower-middle classes in richer Western countries saw much weaker gains.

This matters sociologically because it shows that inequality is not just national. A worker in a deindustrialised British town and a worker in a rapidly industrialising Asian city may be linked by the same global processes, but not in the same way. One may face job loss from offshoring, while the other gains work but under harsh conditions.

TNCs are central here. They decide where factories, offices, and supply chains will be located. Because they can threaten to relocate, they often have leverage over governments and workers. They can search globally for cheaper labour, weaker regulation, lower taxes, and more favourable trading conditions. This helps explain the "race to the bottom": competition between places to offer the lowest costs and the fewest constraints in order to attract investment.

Neoliberal globalisation intensifies this process. Organisations such as the IMF, World Bank, and WTO have often promoted policies based on deregulation, privatisation, free trade, and reduced public spending. Supporters argue that these policies encourage efficiency and growth. Critics argue that they weaken welfare systems, reduce labour protection, and make poorer countries more dependent on global capital.

Milanovic's work is useful because it captures broad patterns of global income change, but it also has limits. Large comparative income datasets are strong for showing long-term trends, yet they can hide differences within countries and say less about power, wealth ownership, or working conditions. Sociology therefore needs both macro evidence and theories about who controls production.