£590 per head social mobility GDP boost

BOOSTING SOCIAL MOBILITY TO WESTERN EUROPEAN AVERAGE COULD RAISE GDP BY £39 BILLION OR £590 PER PERSON

NEW POLLING FINDS GROWING PUBLIC PESSIMISM ON SOCIAL MOBILITY

Just a small improvement to social mobility in the UK – bringing it up to the western Europe average – could lead to an annual increase in GDP of £590 per person, according to new research by economic consultancy Oxera for the Sutton Trust. This improvement to social mobility could boost GDP by 2.1% in the long term, equivalent to around £39 billion in total.

The Oxera report – which will be presented at the Trust’s 20^th anniversary summit opened by Education Secretary Justine Greening today – comes as new Ipsos MORI polling finds growing public pessimism about the chances of today’s young people getting further than their parents. The research is published with a new report from the Boston Consulting Group (BCG) that examines the state of social mobility in the UK and likely challenges for the future, including the impact of automation.

Oxera research: Social mobility and economic success

The Oxera report examines historical changes in social mobility in the UK and analyses the link between social mobility and economic performance. It finds that even if levels of social mobility were brought up to the level of the next best performing country in Europe – the Netherlands – the UK could expect GDP to increase by around £370 per person, or £24 billion in total.

According to the analysis, the major factor driving the relationship between improving social mobility and economic performance is better matching between people and their jobs. Oxera says: “Better social mobility means that the talents of all young people are recognised and nurtured and that some barriers to jobs – biases in recruitment processes or inequality of educational opportunity – are reduced.”

“In a more socially mobile society, it is more likely that a job will be filled by someone with the highest level of potential to perform well in that job, rather than someone who may be less well suited but, for example, better connected.” Evidence from a number of European countries summarised in today’s report confirms that those countries with higher levels of social mobility have people better matched to job opportunities and a more productive workforce.

Ipsos-MORI polling

Also published ahead of today’s summit is specially commissioned Ipsos-MORI polling that gauges public perceptions of social mobility and how best to improve it. The Trust has commissioned similar polling in previous years, which allows us to examine how attitudes have changed over time.

Highlighting a growing pessimism with respect to social mobility, just two-fifths (40%) of the 2,001 adults surveyed in 2017 agreed that people in the UK have equal opportunities to get on, a big drop on the 53% of the public who agreed with those sentiments close to a decade ago in 2008. More people (42%) now disagree than agree.

Despite talk of pessimism among young people in the UK, it was the youngest age groups that were more likely to feel they had better prospects. In fact, 40% of school-age young people from 11-16, asked separately as part of Ipsos MORI’s Young People Omnibus, felt they had better prospects than their parents. In the adult survey, 16-24 year olds were more likely to say that today’s youth would have a better life than their parents, in comparison to 25-34 year olds and 35-44 year olds (33%, compared with 26% and 25%, respectively).

There is also a low and declining percent of the public (from 43% in 2003 to 29% in 2017) who believe today’s youth will have a better quality of life than their parents, although it is important to bear in mind differences in sample sizes and survey methods between each of these three surveys.[1]

The respondents were also asked which measures would most likely improve social mobility and help disadvantaged young people get on in life. Almost half (47%) chose ‘high quality teaching in comprehensive schools’ ahead of two social mobility policies adopted by the main parties in the recent election: ‘lower university tuition fees’ (cited by 23%) and more grammar schools (8%).

Sir Peter Lampl, Chairman of the Sutton Trust and of the Education Endowment Foundation, said today:

“Britain has very low social mobility compared to other countries.  Our research shows that if social mobility were brought up to the western European average, GDP would increase by 2.1%, equivalent to a monetary value of £39 billion.  There is also a low and declining percent of the public (from 43% in 2003 to 29% in 2017) who believe today’s youth will have a better quality of life than their parents.

“At the Sutton Trust we have been working to improve social mobility for the last 20 years.  Although progress has been made, much more needs to be done. The Government should make improving social mobility a top priority. Alongside other initiatives there needs to be a concerted effort to improve early years provision, provide fairer access to schools and universities and address the numerous social barriers which exist.”

Helen Jenkins, Managing Partner at Oxera, said:

“Social mobility is a good thing in itself – separating an individual’s opportunities from their parental background is a key pillar of social justice. But our analysis demonstrates that it does far more than this. Increasing social mobility can help solve the productivity puzzle, increasing wealth for everyone.

“Identifying and attracting young people with the highest potential is critical to all service-led businesses, in particular Oxera – in that sense our findings do not surprise me; social mobility is good for businesses like ours, as well as good for society.”

BCG research

The BCG report assesses the state of social mobility in the UK, how key social mobility drivers have changed over the last 30 years, and how future changes in the labour market could impact social mobility. It identifies key challenges and opportunities, particularly those associated with automation.

Commenting on this research, Ian Walsh, Senior Partner and Managing Director at the Boston Consulting Group, said:

“The future of work and in particular automation is likely to bring further challenges for social mobility in the UK. There will be significant structural change with the elimination of certain jobs and the creation of new jobs. Continuing to invest in early intervention as well as an emphasis on STEM subjects and apprenticeships, can help fill widening skills gaps and train young people for the new demands of the labour market.

“BCG has a long-standing proud relationship with The Sutton Trust. We were delighted to work with them on this important report on the status of social mobility in the UK.”

 

NOTES TO EDITORS

1. The Sutton Trust is a foundation set up in 1997, dedicated to improving social mobility through education. It has published over 200 research studies and funded and evaluated programmes that have helped hundreds of thousands of young people of all ages, from early years through to access to the professions.
2. To estimate the relationship between social mobility and productivity, Oxera used existing data on levels of social mobility (measured as the relationship between an individual’s income and the level of education of the parent), job matching (measured as how well an employee’s education matches job requirements) and productivity (using national statistics), across European countries. They used the data to identify the relationship between social mobility and  job matching. They then used findings from existing research on the relationship between job matching and productivity to derive the link between social mobility and productivity. For more information, see the full report here.
3. Ipsos MORI conducted an online survey of 2,001 adults aged 16-64 in Great Britain, between 6^th and 8^th June 2017. Quotas were set for age, sex and region, and data were weighted to the population profile of the British population aged 16-64.
4. Ipsos MORI conducted a face-to-face survey of 2,060 adults aged 16+ across Great Britain between 15^th and 20^th May 2008. Data were weighted to the known profile of the British population aged 16+.
5. Ipsos MORI conducted a survey of 2,881 11-16 year olds across schools in England, Scotland and Wales.  Fieldwork took place between 6^th February and 17^th May 2017.  Data were weighted by region, sex and year group to the known profile of pupils.
6. Ipsos MORI conducted a face-to-face survey of 2,075 adults aged 16+ across Great Britain between 10^th and 15^th April 2003. Data were weighted to the known profile of the British population aged 16+.
7. Ipsos MORI conducted a telephone survey of 1,006 adults aged 18+ across Great Britain between 19^th and 21^st November 2011.This question was answered by half of those interviewed (506). Data were weighted to the known profile of the British population aged 18+.

[1] Differences in survey methodology and sample definition between the two surveys mean they are not directly comparable; as such, this change should be viewed with some caution.