Updated BG Prasad’s Socioeconomic Status Classification for the Year 2023

Abstract

Socioeconomic scales are used to determine the socioeconomic status of a study subject which in turn affects the health and nutritional status. BG Prasad’s scale of socioeconomic status uses only one criterion i.e. income. Therefore, it is easy to calculate and the most used socioeconomic scale to classify a study subject. It is used for both urban and rural areas. The consumer price index for industrial workers measures inflation at household level. As the consumer price index for industrial workers is used to calculate the income ranges for a study subject and it is released for every month by Labour Bureau, Ministry of Labour and Employment, it is imperative to update the BG Prasad’s scale every month.

INTRODUCTION

Socioeconomic status or social class is an important determinant of one’s health as it influences the incidence and prevalence of various health conditions and the accessibility and acceptability and actual utilization of various health facilities.[1]

There are many different scales to measure the SES of a family. BG Prasad classification proposed in the year 1961 is a scale based on per capita monthly income (modified in 1968 and 1970) and has been used extensively in India. In rural areas, Pareek classification based on nine characteristics, viz. caste, occupation, education, level of social participation of head of the family, landholding, housing, farm power, material possession, and total members in the family is widely used.[2]

Modified Kuppuswamy scale is commonly used to measure the SES in urban communities. The scale includes the education, occupation of head of the family, and income per month from all sources.[2]

With the passage of time and inflationary trends of the economy, the original income limits set in the BG Prasad classification have become substantively low and impractical. These income limits emphasize only the need for updating this classification with time.[1]

The Labor Bureau, Ministry of Labor and Employment has been compiling and maintaining the Consumer Price Index for Industrial Workers since 1944. Thereafter, the series were revised on different bases, i.e., 1944 to 1949, 1949 to 1960; 1960 to 1982, 1982 to 2001; and 2001 to 2016.[3]

The new series of Consumer Price Index for Industrial Workers (CPI-IW) on base 2016 = 100 has been effective from September 2020. These indices measure the relative changes in retail prices of fixed basket of goods and services consumed by industrial workers over a period.[3]

The consumer price index numbers for industrial workers are utilized for regulation of wages and dearness allowance for millions of workers and employees in the country.[3]

The indices are released monthly, and the index of the previous month is released on the last working day of the ongoing month.[3]

The data collected for 463 items from 317 markets and 88 centers across the country makes it more representative in character and reflects the latest consumption pattern of the target population, i.e., industrial workers.[3,4]

This article presents the updated BG Prasad’s socioeconomic scale for 2023.

METHOD

To calculate the income categories, we use the most recent value of consumer price index for industrial workers released by Labor Bureau, Ministry of Labor and Employment. The value of CPI (IW) for April 2023 is 134.2.[5]

The original BG Prasad’s classification is given in Table 1.

Table 1.

BG Prasad’s socioeconomic status classification 1961

Social class	Per capita monthly income limits
I	100 and above
II	50 – 99
III	30 – 49
IV	15 – 29
V	<15

As reproduced in[1]

Linking factors are used to convert the CPI from the new base to the old base. The first base year for CPI is 1960. Taking the base of CPI for 1960 as 100, and it got modified in 1982, 2001, and 2016. The linking factors for 1982, 2001, and 2016 were 4.93, 4.63, and 2.88, respectively.[6,7]

The values of linking factor between year series from 1960 to 2016 are given in Table 2.[8]

Table 2.

Linking factor for the calculation of per capita income from the year 1960–2016

Price index year	Value	Linking factor between year series	Value
1960	100
		1960 – 1982	4.93
1982	100
		1982-2001	4.63
2001	100
		2001 – 2016	2.88
2016	100

CALCULATION OF NEW INCOME RANGES

CPI for Industrial Workers for April 2023 = 134.2.[5]

Multiplication factor = current index value (134.2)/base index value in 2016 (100) =1.342.[6]

The new income value can now be calculated using the following equation:

New income value = Multiplication Factor × Old Income Value × 4.93 × 4.63 × 2.88

Where 4.63, 4.93, and 2.88 are the linking factors given by the Labor Bureau.[3,4]

This calculation gives us a lower value of each income category.

• i)new income value = Multiplication Factor × Old Income Value × 4.63 × 4.93 × 2.88[6]

  = 1.342 × 100 × 4.93 × 4.63 × 2.88 = 8822.11 (Rounded off to 8822)

• ii)new income value = Multiplication Factor × Old Income Value × 4.63 × 4.93 × 2.88

  = 1.342 × 50 × 4.93 × 4.63 × 2.88 = 4411.06 (Rounded off to 4411)

• iii)new income value = Multiplication Factor × Old Income Value × 4.63 × 4.93 × 2.88

  = 1.342 × 30 × 4.93 × 4.63 × 2.88 = 2646.64 (Rounded off to 2647)

• iv)new income value = Multiplication Factor × Old Income Value × 4.63 × 4.93 × 2.88

  = 1.342 × 15 × 4.93 × 4.63 × 2.88 = 1323.32 (Rounded off to 1323)

The updated values for the per capita monthly income in INR for April 2023 are given in Table 3.

Table 3.

Updated BG Prasad’s socioeconomic status classification for April 2023

Social class	Original classification of the per capita income (in INR/month)	Updated per capita income (in INR/month) April 2023
I	100 and above	8822 and above
II	50 – 99	4411 – 8821
III	30 – 49	2647 – 4410
IV	15 – 29	1323 – 2646
V	< 15	< 1323

DISCUSSION

We need only two things to calculate the socioeconomic status of a study subject, 1) monthly income and 2) latest CPI for industrial workers from Labor bureau, Ministry of Labor and Employment. When compared to other scales for socioeconomic scale, it is much easier to calculate. Consumer price index for industrial workers reflects consumption pattern of working-class families; therefore, it is used to calculate the socioeconomic status of a family.

CONCLUSION

The socioeconomic status of an individual has bearing on the health and nutritional status of an individual. Consumer price index measures change in prices of goods and services at household level over a period. BG Prasad scale of socioeconomic classification needs to be updated on regular basis to account for the fluctuation in prices of goods and services which is picked by consumer price index. This article is written to update the BG Prasad scale to incorporate the latest changes in the prices of goods and services.

Financial support and sponsorship

Nil.

Conflicts of interest

There are no conflicts of interest.