This chapter analyses the changes in urban social structure, and especially the changes in occupation structure, in Latin America from the 1930s to the 1980s that resulted from the coming together of three processes: rapid urbanization; industrialization in its different stages; and the growing importance in the Latin American economies of the service sector, both traditional services and modern services linked to the growth of government bureaucracy and to twentieth-century business practices (technical, financial, administrative). In developed countries similar processes produced a convergence of social structures: the expansion of the middle classes, the consolidation of an industrial working-class, and improvements in the general welfare of the population. In the case of Latin America, there has been a greater heterogeneity in patterns of stratification. The dependence of the region on foreign technology and, increasingly, on external finance, combined with its role in the world economy as a supplier of primary and, hence, rurally based commodities, resulted in an uneven modernization, both between countries and between regions of the same country. This chapter will emphasize these differences and the need to pay attention to the specific situation of each country.

In terms of social stratification, there was in Latin America a contradictory relationship between urban growth, economic development and modernization. The cities multiplied and concentrated economic resources. Industrial growth stimulated the increase in levels of education, the proletarianization of the labour force and also the expansion of the non-manual sectors. On the other hand, this same urban growth brought with it a marked polarization of the social structure, both in terms of income and in labour conditions as shown by the persistence of non-waged forms of labour (self-employed workers, unpaid family workers) and highly skewed income distributions.