Personal Finance

The Difference Between White Collar and Blue Collar

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If you’re one of the 90% of lucky Americans currently employed, then you can probably define your job as either white collar or blue collar. You may not know where your job falls but you’ve probably heard the terms on the news more than anywhere else. Even though the definitions are generally used to represent types of crimes, there’s actually a history that dates pretty far back as to why some jobs are considered white collar and others, blue collar.

White Collar

The term white-collar is often credited to novelist Upton Sinclair, who used the term to refer to clerical, administrative work. But, the term was used as early as 1911 and the Wall Street Journal used the term as early as 1923. ‘White collar’ is generally used to refer to work that doesn’t require strenuous physical labor. Sinclair’s version of the term refers to the dress code-required white collared shirts male office workers were required to wear during the 19th and 20th centuries. Typically, white-collar workers are paid a salary, rather than an hourly wage.

White collar crime was first coined by criminologist Edwin Sutherland, who defined it as “a crime committed by a person of respectability and high social status in the course of his occupation. In common parlance, white-collar crime typically refers to non-violent crimes, such as bribery, money laundering, fraud, electronic theft, embezzlement, copyright infringement, identity theft, income tax evasion, and insider trading. As a rule of thumb, the term generally refers to crimes only available to white-collar workers. That is, chances are that blue collar workers won’t have the opportunity to launder money across international borders. That sort of infraction generally requires the involvement of high-level bank officials.

Five common white collar jobs are:

  • Doctor
  • Accountant
  • CEO
  • Lawyer
  • IRS Auditor

Blue Collar

The term blue collar, conversely, refers to workers whose work requires manual labor. Their work can be skilled or unskilled and can fall into any number of industries. Welders, road crews, factory assemblymen, construction workers, miners, loggers, and many other types of laborers are all considered blue collar. Blue collar workers are generally paid an hourly wage rather than a salary. Most union ranks are filled with blue collar workers. The term is said to be derived from the clothing typically worn by manual laborers. Blue collar labor typically requires durable clothes able to withstand reasonable wear and tear. At one point, a key feature of such clothing was a durable navy or light blue work shirt. (Think of the dark blue coveralls often worn by repairmen and mechanics.)

Blue-collar crimes generally refer to crimes against others or against others’ property like vandalism, burglary, home robbery, and shoplifting. To get an idea of what blue-collar crime usually refers to, think of the obvious crimes likely to prompt a police officer’s attention.

Five common blue collar jobs are:

  • Carpenter
  • Electrician
  • Plumber
  • Mechanic
  • Welder

Both terms can also be used to describe areas, establishments, and clientele. A blue-collar neighborhood could refer to a community mostly inhabited by manual laborers, for example. A blue-collar bar refers to a place frequented by local wage-paid employees. A white-collar suburb might be filled with administrators, accountants, and so on.

Formerly, the assumption used to be that (legitimate) white-collar workers out earned (also legitimate) blue-collar ones. Though still largely true, that distinction seems to be changing as labor jobs become more and more technically demanding. Blue-collar jobs that require much training and skill can pay higher than some white-collar ones. Electricians, cable-line repairmen, and other highly technical, mentally exhausting blue-collar jobs can be highly compensated for.

Rob Berger

Rob Berger

Rob Berger is the founder of Dough Roller and the Dough Roller Money Podcast. A former securities law attorney and Forbes deputy editor, Rob is the author of the book Retire Before Mom and Dad. He educates independent investors on his YouTube channel and at RobBerger.com.


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