A recent report issued by the Co-op in conjunction with the think tank Demos has uncovered a significant economic drawback faced by the United Kingdom due to insufficient social mobility in workplaces. The study reveals that this systemic issue is costing the UK economy a staggering £19 billion in lost GDP each year.
The Co-op report, aptly named ‘The Opportunity Effect’, pinpoints the potential gains of prioritising social mobility, projecting an increase of £6.8 billion in annual tax revenues through enhanced economic activity. This sum could finance over 170,000 teaching positions or provide 884,000 additional school places.
Data from a survey conducted by the Co-op involving 2,000 UK adults indicates a consumer preference towards companies that actively promote social mobility. Approximately 29% of respondents expressed a likelihood to purchase from such companies, with the percentage rising to over 40% among younger individuals aged between 18 and 34.
Moreover, a separate survey of business leaders highlighted that 76% perceive benefits in promoting social mobility in terms of attracting and retaining employees, and 71% associate it with achieving favourable business outcomes. If businesses were to implement strategies supporting social mobility, private-sector profits could see an upswing of approximately £1.8 billion.
The report makes several recommendations aimed at the government and businesses, urging them to take actionable steps towards improving social mobility. Suggestions include vesting Skills England with statutory duties to enhance social mobility, establishing a government-endorsed Better Opportunities Fund to partner with the private sector, and encouraging companies to solicit socio-economic data voluntarily from job applicants.
Co-op CEO Shirine Khoury-Haq, commenting on the report, stated, “This report marks an important moment in the UK’s productivity debate and puts social mobility at the heart of that discussion. It shows that breaking down barriers to opportunity can be a much-needed boost for the UK’s economy and for business performance.”
In alignment with its broader initiative to advance social mobility, Co-op is appealing to businesses for feedback on support mechanisms they require to champion this cause within corporate environments. Furthermore, the Co-op intends to develop practical toolkits for businesses, informed by received insights.
The Co-op report underscores the critical economic implications of inadequate social mobility in the UK, urging coordinated efforts from both government and businesses to unlock untapped potential. The proposed strategies aim not only to stimulate economic growth but also to promote societal equity.
