"Class is a communist concept," Margaret Thatcher told Newsweek in 1992. "It groups people together and sets them against each other." Just over a decade later, Thatcher's crude rightwing dogmatism had given way to a kind of all-pervasive centre-right wishful thinking. Towards the end of his reign as prime minister, Tony Blair told a New Labour think-tank "we're all middle class", an opinion echoed more recently by both the Daily Telegraph ("We're all middle class now, dahling") and the Times ("We're all middle class now as social barriers fall away").

The truth, as Owen Jones's points out, is more complex and more disturbing. Chavs, despite its provocative title, is a lively, well-reasoned and informative counterblast to the notion that Britain is now more or less a classless society. For Jones, the British class system is "an invisible prison" from which, increasingly, there is little escape for those born into working-class families. Without the privilege of family wealth, higher education  and the lucrative careers it provides access to  is fast becoming a no-go area for all but an elite sector of the population. Britain is well on its way to becoming a society run by the wealthy for the wealthy.

Jones, who is 26 and has worked as a trade union lobbyist and parliamentary researcher for a Labour MP, begins by looking at the rise of "chav" culture. This, he argues, was created and then mercilessly lampooned by the middle-class, rightwing media and its more combative columnists. The crimes committed by "chavs" included being too loud, too flash, too drunk, too vulgar and, most inexcusable of all, too disrespectful towards their "betters". Somewhere between the rise of New Labour and the start of the current financial recession, the middle classes seemed suddenly surprised and appalled to discover a new "feral underclass" (Simon Heffer) in the place of the old deferential proletariat.

One one level, Jones has written a book about how the dread word "chav" came into being and how it has been bandied about without much thought. (The word's origins are unclear: it may derive from the Romany word "chavi", meaning "child", but it is now usually understood as an acronym for "council house and violent".) Jones gives some vivid examples of just how loaded the term has become: there is a popular self-defence course called "chav fighting", run by the fitness company Gymbox. Perhaps predictably, the Daily Telegraph has led the media assault against the chavs, with James Delingpole caricaturing their offspring as "rudderless urchins downing alcopops and cans of super-strong lager".

All this moral humbug would be laughable, argues Jones, if it weren't so pernicious. Since Margaret Thatcher's divisive reign, he says, the working class have been increasingly disenfranchised politically and economically while simultaneously being caricatured as feckless, lazy, loutish and amoral. What was once gross caricature  Little Britain's Vicky Pollard  has somehow become a symbol of broken Britain.

For Jones, though, the "chav" phenomenon is really just a starting point. His book develops into a sustained polemic about the perniciousness of the British class system. Taking his cue from a quote from the Observer's Nick Cohen  "To say class doesn't matter in Britain is like saying wine doesn't matter in France; or whether you're a man or a woman doesn't matter in Saudi Arabia"  he ranges far and wide in his research, touching on the changing political landscape of post-Thatcher Britain, the ever-widening gap between the wealthy and the rest, and the ways the middle classes find to justify their selfishness.

Jones is good on the causes of what appears to be a new sense of working-class powerlessness  the waning power of the unions, the destruction of traditional jobs and, with them, the communities they fostered, the reckless rush towards globalisation and the attendant deregulation of the markets, which has bred a kind of helplessness among those left behind. His final chapter offers some well-reasoned remedies, all of which, interestingly, call for a revitalisation of the traditional bodies that underpinned working-class struggles of old. Whether the new middle classes would countenance such a ground-up revolution remains to be seen, although a period of austerity could well be the motor for the kind of radical shift in consciousness that Marx once urged the proletariat to undertake. Now, that would be Thatcher  and Blair's  worst nightmare.

Owen Jones's indignant, well-argued debut begins with a joke: "It's sad that Woolworth's is closing. Where will all the chavs buy their Christmas presents?" This was uttered by the host of a dinner party attended by the author in "a gentrified part of east London", at which liberal views are taken as a given and, though everyone present has a professional job, not everyone is white, male or straight.

Jones, who is in his late 20s and has worked both as a trade-union lobbyist and as a parliamentary researcher for a Labour MP, doesn't say how he reacted to this mindless put-down at the time. Did he refuse to eat the blackcurrant cheesecake that was being "carefully sliced" as his host sought to fill an awkward silence? Did he storm out and call time on their friendship? Whatever he did on the night, its casual malice led him, indirectly, to write this book, which argues that class hatred is the last acceptable prejudice.

Chavs is persuasively argued, and packed full of good reporting and useful information. Jones singles out for opprobrium middle-class contempt towards working-class people, those regarded by rightwing commentators such as Simon Heffer as the "feral underclass". In this caricature, peddled by spittle-flecked websites such as chavscum.co.uk and tacitly endorsed by the mass media, "chav" means "underclass", which means working-class people who don't keep their noses clean or behave impeccably. The word's etymology is contested: some accounts associate its origin with chavi, a Romany word for "child" or "youth", which developed into "charva"  meaning scallywag  used for a long time in the northeast. Others treat it as an acronym for "Council Housed and Violent". Its wider use took off about 10 years ago. In early 2004 I worked briefly for a tabloid newspaper whose offices rang with its daily use (along with its bedmate, "pikey"), directed not towards the paper's readers, but towards those it was assumed would be too "thick" to read any newspaper at all. Chavs, Jones writes, are unremittingly portrayed as "Thick. Violent. Criminal." Travel brochures still apparently promise "Chav-Free Activity Holidays", while the London fitness chain Gymbox has felt free to advertise classes in "Chav Fighting".

Jones digs beneath this foul new orthodoxy to reiterate the facts of increasing inequality, which has led British society to become ever more segregated by class, income and neighbourhood. In such circumstances, miscommunication has deepened between the classes; the Conservatives' demeaning of trade unions has helped to strip the working classes of what public voice they had, so that the middle class has effectively become the new decision-making class.

But while it's always right to argue, and to keep arguing, that the balance of power in our social and economic structure is hopelessly, immorally off-whack, there is a cost to denying the personal volition of working-class individuals. Jones  understandably given the book's subtitle  treats class hatred as a one-way street, rather than a collusive, often subtle, process which demeans everyone. In fact, a great deal of chav-bashing goes on within working-class neighbourhoods, partly because of the age-old divide between those who aim for "respectability" and those who disdain it. Inverse snobbery can also be expressed towards those perceived to be "stuck-up". New Labour pummelled liberal critics with populist arguments that ran along this pre-existing faultline. Both Jack Straw and David Blunkett, with seats in Labour's post-industrial "heartlands", tried to out-Asbo each other during their respective terms as home secretary. Middle-class hatred of working-class people  or, rather, a particular image of working-class people which some hold in their minds  is a different beast, saying more about the way in which the education system, especially, is structured to prevent most privileged students from ever having to confront their own averageness.

The one occasion on which the agency of an individual is properly invoked by Jones is in his discussion of the case of Shannon Matthews, the Dewsbury schoolgirl whose mother, Karen, conspired to have her kidnapped in the hope of netting a £50,000 police reward. In that case, Karen Matthews is rightly considered to represent only herself, rather than her wider, poor working-class community, on which the newspaper stories fixated. Yet a similarly detailed chapter on spurious links made in the mass media between support for the BNP and "white working-class culture" makes no such distinction. Jones claims that "hundreds of thousands of working-class people" were "driven into the waiting arms of the BNP" before the party's electoral collapse in 2010, but he fails properly to establish the link between being working class and holding far-right views. He adds fuel to the fire by adding: "Karl Marx once described religion as 'the sigh of the oppressed creature': something similar could be said about the rise of the far right today." Quite apart from the questionable nature of equating religious faith with fascist sympathies, the quote points to a difficult truth about left-of-Labour politics: it requires working-class people to be "oppressed creatures", always victims, not rational actors in a play they help to write.

Divide-and-rule political gambits don't work unless there are enough people who don't already tend, in some way, to one side or the other: classes are complicated entities. One example of this is how different people living in council housing reacted in 1980 to the introduction of the "right to buy" policy, which, Jones argues, was calculated to undermine working-class solidarity. Their decisions were partly a reflection of the circumstances they were in, and partly a reflection of their broader outlook as individuals. Some people thought the idea of owning their own home was wonderful, or held it as a long-term aspiration. Others found the idea repellent and saw it as a deliberate attempt to break up communities. Still others were concerned only with the practical elements  could we afford to replace our own boiler?

Jones doesn't acknowledge this, preferring to treat "the working class" as a single political bloc. Because of this tendency, it can feel as though he romanticises an ideal of working-class life which doesn't always hold true. There is a tinge of the noble savage here and there, particularly in the over-careful way he presents and interprets quotes by his working-class interviewees. Despite this fault, Chavs makes an important contribution to a revivified debate about class.

Lynsey Hanley's Estates: An Intimate History is published by Granta.