A recent study by the Co-op and Demos reveals a significant economic shortfall due to the lack of social mobility in the UK workforce.
A comprehensive report titled “The Opportunity Effect”, conducted by the Co-op in collaboration with the think tank Demos, underscores the profound economic implications of inadequate social mobility within the workplace. It finds that the UK economy is forfeiting approximately £19 billion in GDP growth annually. This loss is attributed to systemic barriers that impede upward mobility, which, if addressed, could transform economic productivity.
The report highlights how enhancing social mobility could considerably increase tax revenues, potentially generating an additional £6.8 billion each year. Such an increase would be sufficient to finance over 170,000 teachers or approximately 884,000 school places, illustrating the tangible benefits of prioritising social advancement.
Further insights from a Co-op survey of 2,000 UK adults reveal consumer tendencies towards businesses that advocate for social mobility, with 29% of the respondents indicating a preference for such companies. This sentiment is especially prevalent among younger consumers aged 18-34, with over 40% showing an inclination to support businesses endorsing social progress.
Additionally, feedback from business leaders indicates strong support for social mobility initiatives. Approximately 76% of these leaders believe that promoting social mobility can aid in attracting and retaining talents. Furthermore, 71% assert that these efforts would lead to improved business outcomes, suggesting a mutually beneficial relationship between social initiatives and corporate performance.
The economic advantages extend beyond revenue and consumer preference. The report asserts that private-sector profits could rise by £1.8 billion if companies implement strategies to promote social mobility. This projection underscores the potential for significant business growth alongside societal benefits.
The report offers several recommendations to enhance social mobility, urging the government and businesses to take proactive measures. These include empowering Skills England with statutory responsibilities for social mobility and establishing a government-supported Better Opportunities Fund to invest in such projects. Furthermore, it encourages businesses to ask job applicants to voluntarily share socio-economic data to better tailor social mobility strategies.
Co-op’s Chief Executive Officer, Shirine Khoury-Haq, emphasised the report’s pivotal role in reenergising the discussion around UK productivity by placing social mobility at its core. According to Khoury-Haq, dismantling barriers to opportunity could substantially benefit both the economy and business performance.
As the discourse on productivity and economic growth evolves, the emphasis on social mobility as a catalyst for change becomes increasingly significant. This report not only sheds light on the economic gaps caused by current social dynamics but also charts a course for bridging these disparities, promising economic and societal gains.
