A lack of social mobility is costing the UK a significant £19bn annually, according to a report by the cross-party thinktank Demos and the Co-op. Social mobility, defined as the connection between a person’s occupation or income and that of their parents, is a key factor in determining opportunities for individuals. The UK ranks 21st out of 82 economies in the World Economic Forum’s Global Social Mobility Index 2020, indicating room for improvement.
The report highlights that individuals from lower socioeconomic backgrounds in the UK are less likely to secure high-paying jobs, even with similar levels of education. This systemic failure to promote social mobility is resulting in a loss of £19bn in GDP growth each year. The study also reveals that prioritizing social mobility within businesses can lead to higher turnover rates.
Co-op, a company involved in retail, insurance, and funerals, has taken steps to enhance social mobility by eliminating video interviews and CV requirements in their hiring process. They have also started reporting their socioeconomic pay gap and established a social mobility taskforce. One member of this taskforce, Azra Keely, emphasizes the challenges faced by individuals from lower-income backgrounds in accessing higher education, vocational training, and affordable housing.
The report, titled The Opportunity Effect, proposes various recommendations to both government and businesses. It suggests granting Skills England a statutory responsibility to boost social mobility and consulting with large employers to increase skills and training expenditure. Additionally, expanding pay gap reporting to include socioeconomic factors, creating a Better Opportunities Fund, and offering incentives to social enterprises are among the suggested measures.
International evidence cited in the report indicates that countries with higher social mobility, such as Sweden, Austria, and Denmark, tend to have greater productivity levels. In the UK, apprenticeships are seen as a promising avenue for improving social mobility, although their full potential has yet to be realized.
Sarah Atkinson, the chief executive of the Social Mobility Foundation, highlights the income disparities faced by professionals from working-class backgrounds compared to their more privileged counterparts. She stresses the importance of eliminating unpaid internships and providing mentorship opportunities for first-generation professionals to address these inequalities.
In conclusion, fostering social mobility is not only crucial for individuals but also essential for the overall productivity and growth of the economy. By implementing the recommendations outlined in the report, the UK can work towards creating a more inclusive and opportunity-rich society for all its citizens.
