Surplus Population and Marxist Class Theory

By David Nielson
Published in Razón y Revolución n°19, 2009


One of the key strengths of Marxist class theory is its grounding in the prevailing mode of production’s core exploitation relation. However, the tendency to equate exploitation directly with class that is linked with a residual attachment to particular elements of the class simplification thesis of the Communist Manifesto has undermined the capacity of Marxist class theory to explain the changing empirical forms of the class structure (Neilson, 2007). To explain its contemporary complexity, and in particular to provide a class analysis of the surplus population, existing versions of Marxist class theory need to be modified.

In particular, the exploitation core of a mode of production needs to be distinguished from its class effects. This categorical clarification and re-specification of the relation between exploitation and class enables Marxist class theory to identify patterns of social difference and heterogeneity, while remaining grounded in the class explanatory power of Marxist political economy. In turn, this modification opens up a way to move beyond the present tendency to derive directly from the central form of the labour-capital exploitation relation all positions across the proletariat and the terms of the class struggle.  Furthermore, Marxist class theory can be freed up to analyze more usefully the specific situation of the surplus population with all its implications for recasting socialist goals and strategy for the 21st century.

This paper is divided into the following sections. First, it critiques present versions of Marxist class theory as theoretical points of departure.  Second, it provides an introductory overview of class theory applied to the surplus population.  Third, it outlines a class analysis of the surplus population in the contemporary capitalist world.  In a brief conclusion, Laclau’s concepts of social antagonism and heterogeneity are linked to a rethinking of the socialist project in the light of this account of the surplus population.

Theoretical Points of Departure

The challenge of Marxist class theory is to explain the complexity of the contemporary class structure and in particular the growing surplus population. This project requires casting aside the limiting effects of the theoretical and political baggage associated with the Marxist interpretation of the class simplification prognosis of the Communist Manifesto. Neo-Marxist writers have usefully challenged the orthodox Marxist version of class simplification in their on-going project to account for class complexity, but in more subtle ways they too remain residually constrained by some of the Communist Manifesto’s baggage.

In The Communist Manifesto, Marx and Engels predict a correspondence between the outcomes of the dynamic of the central production relation of capitalism and the empirical form of the class structure. Marx argues that the dynamic of capitalist accumulation will eventually generate, but not until some undefined prognostic end-point, a correspondence between the essential production relation and the class structure. Problems in Marxist class theory stem partly from Marx’s own political and ideological attachment to the prognosis of the Communist Manifesto, despite its variance with his mature analysis.  Moreover, problems have occurred because Marx did not develop his class theory and thus never theorized the exact nature of the relationship between the essential production relation and an empirical rendering of class groupings.

The orthodox Marxist perspective treats the empirical social formation as a direct expression of the essential capital-labour class relation. The exploitation relation is generally understood in class terms as typically between wage-dependent factory workers, or the fully-fledged proletariat (i.e. working class), and their employer, the capitalist owner of the means of production. The empirical social formation is constructed to reflect this essential exploitation relation in ways that resonate with the class simplification thesis. In particular, all effort is made to think labour as a homogeneous immense majority. First, within the mainstream labour movement, homogeneity has been enforced by suppressing other differences such as gender and ethnicity. Second, while maintaining a sense of the proletariat as the working class, a slippage occurs that makes the proletariat equivalent to wage earners. The ‘embarrassment’ of the ‘middle class’ is explained away by simply equating the proletariat with wage earners. Similarly, the unemployed are typically conflated to be wage workers temporarily out of position. Third, the simplification argument is often been upheld counterfactually, that is, by dismissing the history of the present which is contrasted with the final future determination of the economic ‘in the last instance’.

Against the orthodoxy, Neo-Marxists have recognized clear differences in social experience amongst the proletariat and the bourgeoisie that indicate limitations of the class simplification thesis. However, the essential production relation still tends to be treated as if it concretely and directly equates with the fundamental classes of a given society, and more significantly that all social groups are derived expressions of the relationally constructed class binary. For Carchedi (1975), the fundamental class dichotomy at the highest level of abstraction is distinguished from class groupings that are derived as one descends down the hierarchy of abstraction to the concrete. For Wright, class is exploitation. Thus, the only two genuine or fundamental classes of capitalism are defined by the core exploitation relation, while the middle class is deemed as not really a class at all but a contradictory composite derived from the core relation (Wright, 1986, p. 115; Neilson, 2007). For Resnick and Wolff, fundamental classes are defined by the ‘production and appropriation of surplus value’ (2007, p. 21), while the ‘subsumed’ classes of capital are based on the distribution of surplus value (Ibid, p. 77).  The essential mode of production identifies its central class relation, but it does not follow that the social groups which empirically comprise a fuller account of the social effects of the dynamic of the mode of production only express, albeit in a derived way, the essential class division.

From a social science perspective, the Communist Manifesto can be read as a predictive thesis regarding the long term class effects of the capitalist mode of production. This is the rational core of Marx’s method of class analysis that distinguishes clearly between the accumulation dynamic of the capitalist mode of production and the class effects of this dynamic. This political economy grounding provides a materialist analytic for identifying and analyzing the changing class pattern. Here is the power of Marxist class theory, juxtaposed to the weakness of Weberian theory that remains stuck in a static and descriptive subjectivity, even though both Marx and Weber both share a common sense understanding of class as a descriptor of patterns of social difference and similarity.

The problem is that Marx’s and Marxists’ political and ideological attachment to the Communist Manifesto prognosis itself rather than the method underpins the will to construct the empirical world to correspond with it while undermining the will to really test it. In the Communist Manifesto account, the proletariat comprising wage dependent factory workers, or the working class, is predicted to comprise the ‘immense majority’. However, in Capital Vol. 1, Chapter 25, Marx argues that as an effect of the employment logic of the productivity dynamic of the capitalist labour process the organic composition of capital will increase, and more specifically the ‘relative surplus population’ will grow larger than the active army or working class. He asserts this process as the ‘absolute general law’ of capital accumulation (p. 798).  Nonetheless, Marx concludes his account of the relative surplus population with a famous restatement of the Communist Mannifesto class polarization argument (p. 799).  Instead of following up the revisionist implications of his analysis, Marx wills a connection with the earlier Communist Manifesto thesis by getting the lowest sediments of the surplus population to stand in for the proletariat as a whole.

Chapter 25 actually represents the core elements of a significant revision of Marx’s earlier class analysis. Here, the ‘immense majority’ is not to be equated simply with the working class. Rather, the proletariat is centrally divided between a numerically declining active army and a numerically increasing relative surplus population. Problematically, this new majority is not fully proletarianized by the dynamic of capital accumulation and largely stands outside of the productive circuits of capital.

Analytically, Marx’s definition of the proletariat as waged factory workers that identifies the typical position of labour in the core production relation of the capitalist mode of production remains a benchmark for comparing uneven forms and patterns of actual proletarian situations. The point, however, is not to think of the entire social structure as just the derived expression of this core production relation. Instead, the challenge is to think about how the core capital-labour relation gives rise to a multiplicity of class effects that do not directly reflect the core capital-labour relation. In particular, although the accumulation dynamic of capital, the conditions of which are abstractly defined by the core production relation, generates the surplus population, the latter nonetheless comprise a set of social groupings largely outside the formal capital-labour relation.

Radical neo-Marxist thinkers have also been part of the unraveling of orthodox Communist Manifesto Marxism by challenging the idea of the working class as the socialist vanguard. In Farewell to the Working Class (1982), Gorz argues that the industrial working class has become incorporated into capital and that it declines absolutely as a proportion of the broader proletarian population. In its place, he takes up the banner of the surplus population under the name of the ‘neo-proletariat’. Following Lukacs, Gorz ‘imputes’ from the realigned ‘typical’ proletarian position of the neo-proletariat a new socialist project. However, he focuses one-sidedly on the advanced post-industrial countries and also retains a vanguard conception of labour.  While the orthodox view treats the proletariat as the working class under which all other strata of labour are incorporated, Gorz now understands the neo-proletariat in this way. He does not consider the class analytical problem of placing centre-stage the class that is not central to the capital-labour relation. Addressing such issues raises important class analytical problems, as well as urgent questions to do with rethinking socialist strategy in the light of the surplus population.

Class Theory and the Surplus Population

The capital-labour relation identifies the essential structure of production and accumulation that, in contrast to other modes of production, uniquely defines the capitalist mode. As a structure of accumulation, the capital-labour relation refers to the process of exploitation that transforms surplus labour generated by the immediate producers into forms of capital. Dynamic capital accumulation is based on the logic of industrialization and real subordination that reduces necessary labour and generates relative surplus value. This process underpins the power of the capitalist mode of production to deliver indefinitely expanding accumulation.

However, surplus labour created by this process does not simply equate with surplus value that is realized as profit.  Rather, until redeployed again by capital, surplus labour is a surplus population (Marx, 1973, p. 399). Marx argues that as an effect of its quest for profitability in an environment of inter-firm competition, capital seeks both to maximize the number and the hours worked of the total population engaged in necessary labour and to reduce to a minimum such a population. As an employment process, the accumulation dynamic of capitalism thus alternately expels and redeploys labour.  By reducing the time taken to produce a constant bundle of commodities, equivalent to the value of labour power, capital increases the population that potentially can be deployed as necessary wage labour. Over the long term, this expulsion redeployment logic ‘spreads wage labour absolutely’ but not evenly or necessarily productively.

On the one hand, productive redeployment occurs by increasing the volume and variety of production, and by greater investment in the development of productive forces. This industrialization process also represents the shift of the labouring population from the agricultural sector to the industrial and so-called ‘service’ sectors. On the other hand, the incapacity of the capitalist mode of production to redeploy all labour made surplus by this process implies the continuing presence of a relative surplus population.  As a direct effect of its own logic, the capitalist mode of production systematically eliminates the livelihoods and thus access to means of subsistence for a segment of the population, and is subsequently unable to redeploy all members of this segment back into the formal accumulation process.

Capital draws a reserve army of labour from the surplus population, defined as a highly flexible workforce that can be deployed only when and where needed by capital. This flexibility adds a further mechanism for ensuring the maximum constancy of the labour activity parallel with the effect of real subordination. A reserve army also enhances managers’ disciplinary power by maintaining pressure on those in the active army.  Furthermore, capital can continue to generate absolute surplus value as the reserve army’s price as an effect of market logic falls below the active army and reserve army members seek longer hours in compensation. Marx also refers to the ‘lowest sediment of the residual surplus population’ that remain outside of the reserve army (1976, p. 788).  He includes ‘orphans and paupers’, the ‘demoralized, the ragged…’, ‘people who have lived beyond the worker’s average life-span’, ‘the mutilated, the sickly, the widows, and the lumpen-proletariat that includes ‘vagabonds, criminals, prostitutes…’ (Ibid, p. 797).

The contradictory tendency of capital to seek both maximum reduction and maximum deployment of necessary labour implies a basic division in the proletariat between necessary labour and the surplus population. Necessary labour, or the active army, as an expression of the core capital-labour production relation, is defined in terms of the wage relation plus the technical production relation. The wage relation concept has two dimensions: the social relation of exploitation, and wage dependence or formal subordination. The basic proletarian condition thus has two stages. First, the absence of an alternative means of subsistence leading to waged employment. The second stage refers to the technical relation of production that ‘really’ subordinates labour to the relentless productivity driven logic of industrial organization. This accumulation dynamic of capitalism spreads wage labour into new fields and subordinates the industrial proletariat to the effects of ‘real subordination’ but it also renders people surplus to the capitalist production system, thereby leaving a surplus humanity without means of subsistence.

Thus, the core accumulation dynamic of capitalism generates a social group that is largely outside of the main circuits of capital and productive labour that define the core capital-labour relation. The benchmark criteria that define labour in terms of the core exploitation relation are only partially met for the relative surplus population. The first condition, the absence of a livelihood, is met.  However, unless redeployed as wage workers, this surplus population is not in a directly exploitative relation with capital and does not experience the second aspect of formal subordination. Further, apart from the situation of some members of the industrial reserve army, the surplus population does not engage in activities that resemble the core working class’s situation of real subordination. The active army refers to the formal secure working class while, in contrast, the relative surplus population’s situation is both informal and insecure. In short, though in more desperate circumstances than the working class, the relative surplus population is less than formally proletarianised.

Surplus Population in the Contemporary Era

During the contemporary era of neoliberal global capitalism, the coercive and competitive logic of capital has been unleashed on a global scale. The surplus population effects of the neoliberal model’s growth path are exposed by the financial crisis driven collapse of business confidence and the credit mechanisms of demand that weakly countered the process of labour redundancy. In particular, the imposition of advanced global standards of necessary labour on the world’s non-commercialized countryside has made redundant large sections of the rural proletariat and small peasantry. Before the present crisis, the marginalized rural surplus population was estimated at between 2.5 and 3 billion people (McMichael, 2006, p. 187). Those that can, move towards the growing city slums. However, unlike in the first wave of industrialization, the displaced rural population confronts an already highly developed industrial complex and an already existing ‘informal proletariat’ (Davis, 2006).  According to UN estimates, in 2005 this slum dwelling population was over a billion people (Cited in Davis, p. 23).  Predictions are that all future growth will occur in the urban environment (Ibid, p. 22). Marx’s own claim that the relative surplus population will continue to grow matches the contemporary evidence, and is reinforced as the redeployment tendency confronts not only the consequences of the present financial crisis but more significantly as it hits environmental limits (Neilson, forthcoming). However surplus population and environmental effects are spread unevenly because countries and regions are at different development stages (Weeks, 2001). Capitalist states successful in the competitive race to attract and keep international capital are characterized by employment mobility patterns ascending upwards from the residual to reserve segments of the surplus population, and from the reserve army to the active army. Less successful and un-successful countries are characterized by the reverse logic.

In general, the changing size and composition of the relative surplus population depends on the circuits and cycles of the formal capitalist order.  The reserve army contracts and expands as a direct product of the contraction and expansion of the production and consumption capacities of formal capitalism. The industrial reserve army is directly dependent on the main formal circuit of capital while those in the unproductive and informal residual segments of the relative surplus population are dependent on the consumption capacities of those inside capital’s productive circuit.  Welfare transfers in the advanced countries limit the size of the informally employed residual segments.  In the reverse way, mainstream capitalist society has a parasitic relation with the relative surplus population. Capital draws on this part of the labouring population only when and where required, and capitalists such as slum landlords channel wealth directly back into formal capitalist society.

Rather than simply a component of broader capitalist society, the informal and illegal sectors occupied by the relative surplus population, socially and spatially separated from the active army situated in the core productive circuits of capital, can be understood also as a shadow capitalist society with its own internal class structure. In the main circuit of capital, relative surplus value is produced by the formally and securely employed active army. Most of the active army of labour, comprising core skilled manual production workers plus knowledge workers, has legal, on-going, relatively well-paid employment. This population represents legitimate taxpaying, consuming and producing ‘first class’ citizens. Under global neoliberal capitalism, security declines for the most, especially as the size of the relative surplus population grows. However, insecurity is the daily reality of the surplus population who occupy an informal and often illegal environment outside of regular society. This shadow society represents the socially excluded, or in post-Marxist terms the ‘constitutive outside’ of formal capitalism. In sum, the informal and illegal sectors of capitalism together represent a shadow society that expresses complex, contradictory, and undeveloped forms of the capital labour relation creating a ‘museum’ (Davis, 2006) of forms of exploitation and stratified patterns of wealth and power.

Workers employed on casual contracts in the industrial sector come closest to the circumstances of the formal core of the working class, but in contrast to the core, this peripheral industrial proletariat is paid less and is precariously employed on casual contracts.  In general, these workers are employed by small and medium sized firms that produce either light industrial goods or are sub-contracted part suppliers to multi-national-corporations. Beneath this capital-labour relation is a descending hierarchy of capitalist enterprises that employ labour in varying degrees of informality and technological simplicity, including home workers, workers in primitive sweatshops and day labourers. The managerial structure of control includes on-site supervisors and also labour entrepreneurs that coordinate labour, such as for the supply of day labourers. In these sectors workers may have no formal employment status not only because of the absence of a formal contract, but also for some because they may be illegal immigrants or undocumented workers.

Capitalists in the most informal enterprises directly exploit cheap labour to produce surplus value without significant fixed capital, such as employing children to pick through rubbish to find rags that are then sown together. Beyond the legally informal capital-labour relation are informal illegal enterprises. Capitalists in the illegal sector include those who control and live-off criminal forms of activity such as drug dealing, the stealing and on-selling of things, prostitution, people and body part trafficking. A network of informal workers often without legal status is employed in this sector including under highly coercive forms of pre-capitalist exploitation relations such as slavery.

As the analysis moves downwards through the hierarchy of informal capital, the contradictory forms of class circumstances become more apparent as incomplete bourgeois criteria overlap with incomplete proletarian criteria. Various strata of the petit bourgeoisie can be identified. These include small shopkeepers, street vendors such as independent market traders, shoe-shiners, rickshaw drivers, food stall and other street vendors. These people may independently own and control their enterprises but remain viable only through working long hours and living off very small profits due to their marginalized position within the competitive structure of capital. Some of these businesses may overlap with informal capitalists if they also employ workers.

These micro-entrepreneurs can also be identified as ‘own-account workers’.  Reserve army workers can be viewed as own-account workers in that they can be constructed as independent sub-contractors who sell their service to a range of employers.  Nonetheless, these workers are still selling their labour-power to an owner of capital and receiving wages. Rather than capital employing labour and appropriating its products that are sold in the marketplace, fully-fledged own-account workers such as micro-entrepreneurs sell their product or service directly to the consumer. For those in domestic service, the consumer may also be the employer. As a response to deep employment and material insecurity, members of the relative surplus population increase their hours of work and spread their risks, both as individuals and as households, by becoming multiple job holders that may encompass various positions across the terrain of the relative surplus population.

Although having a less than fully-fledged proletarian status and located in a diversity of specific class situations, the relative surplus population shares broadly similar conditions of existence. The relative surplus population is a product of the formal productive core of the capitalist mode of production that has made them redundant and expelled them to a shadow capitalist society. The surplus population has lost its means of subsistence and is denied access to the employment or protections that are part of formal society.  Nonetheless, its existence remains dependent, either directly or indirectly, on the core productive circuits of capital either as holders of precarious peripheral positions in the reserve army of labour, or in domestic service, or in informal or illegal employment in the city streets.

The growth of the surplus population to become the new majority signals the ‘real crisis of world capitalism’ (Breman, 2003).  The productive redeployment tendency may absorb some of the surplus population if another capitalist boom can be manufactured, especially for the more successful capitalist countries.  However, redeployment under capitalism implies an escalating consumption of a material world that has already hit environmental limits (see Neilson, forthcoming). The uneven spread of the relative surplus population that is concentrated at the pole of the most unsuccessful and resource constrained under-developed countries overlaps with the uneven geographical spread of the effects of deepening environmental crisis, especially the crisis effects of climate change such as rising temperatures and sea levels, and the increasing scarcity of basic food and energy goods. As capitalism descends into deepening environmental crisis, these relative surplus populations will become absolute surplus populations. The spectres of Darwin and Malthus feed directly into a horrific picture of the future in which capitalism systematically consolidates amongst those inside the productive core of capitalist society, while the surplus population outside these circuits is abandoned or worse. This process corresponds with a spatial logic in which a growing population surplus to the requirements of capitalism is squeezed into a smaller and more environmentally vulnerable confinement within the growing slums of a planet whose viable space, as an effect of environmental destruction, is declining anyway.

Conclusion: Socialist Strategy and the Surplus Population

Instead of the industrial working class becoming the major grouping and vanguard of a broader proletariat, the dynamic of the capitalist mode of production is creating a proletariat that is heterogeneously structured and, in particular, includes a stratified and growing surplus population. Furthermore, rather than the proletariat inheriting the conditions of plenty, capitalism is creating a material world that is being systematically plundered and destroyed. The continued growth of the surplus population that is increasingly intersecting with a deepening environmental crisis is what signals the beginning of the end of capitalism. How can a socialist project practically address environmental crisis and the needs of the surplus population? How can the project of class agency be reconstructed given these central priorities within a broader class structure characterized by contradictory locations, segmentation, and stratification? Building a socialist bloc depends centrally on examining how heterogeneity can be turned into solidarity around a shared socialist project. Although Laclau dismisses the relevance of economic structures and class analysis, some of his key concepts can be usefully deployed to begin thinking through key political and ideological dimensions of these challenges.

According to Laclau, social antagonism cannot occur as a dialectical relation that implies homogeneous poles occupying the same space of social representation, as in the class simplification thesis (Laclau, 2006). However, this paper’s alternative class theory has demonstrated capital’s splitting of labour into necessary and surplus labour generates a disjuncture between the stratified community inside the formal value circuits of capital, and the stratified relative surplus population located outside this formal community.  This approach parallels Laclau’s notion of social antagonism as a struggle between ‘heterogeneous poles and spaces of representation’.

From the vantage-point of the hegemonic discourses of the central capitalist state, reference to the informal outside negatively constitutes formal capitalist society as an ‘impossible but necessary’ social totality, or what Laclau labels as the ‘empty signifier’. That is, formal capitalist society is discursively constituted as a coherent community by reference to the other, i.e., those beyond or outside of it in the ‘anti-community’ of the informal world. This constructs a complex social antagonism in Laclau’s sense. A radical limit or frontier is created that separates those inside from the ‘other’, those outside formal society. The ‘other’ negatively constitutes the positivity of acceptable citizenship behavior but is also constructed as a threat to the former. This is a friend enemy logic. From the standpoint of the informal proletariat or relative surplus population, mainstream capitalist society can be constructed as its external constitutive outside. Formal society has robbed the surplus population of its previous means of subsistence, and remains excluded from redeployment in the active army of labour. As such, formal capitalist society is the anti-community of informal society. This process draws together the active army and capital, while dividing the active army and the surplus population.

At the same time, the informal proletariat’s survival capacity and the potential for emancipation is linked closely to the performance of the formal economy. The links between the community and the anti-community are never entirely severed, especially when the dynamic of the capitalist mode of production draws parts of the surplus population back into the mainstream. The idea that this is possible for some is important to the social Darwinism implicit in neoliberal ideology. The struggle for survival is understood as a competitive process that ultimately enhances the species, because the fit will rise and the unfit will be weeded out. Thus the ideology that constitutes the social whole by way of antagonism further validates itself by reference to a process presented as natural and evolutionary.

This hegemonic construction needs to be reversed in the vision of a ‘necessary but impossible’ formulation of the social totality as a socialist community of the future. This requires formulating a discourse of the socialist totality that replaces the ‘logic of equivalence’ or antagonism, with a ‘logic of difference’ or inclusion. Though prioritizing the need to address the situation of the surplus population, the project needs to go beyond a vanguard conception of the proletariat.  A renewed socialist model needs to demonstrate that universal social security and material sustainability requires a democratic socialist project that can prioritize the goals of security, sustainability and community in a localized material economy facilitated by a new cooperative global model of development.


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