A report by the Co-op and think tank Demos highlights the impactful cost of limited social mobility on the UK economy.
- The UK economy misses an annual £19bn in GDP growth due to a systemic failure in workplace social mobility.
- Improving social mobility could yield £6.8bn in additional tax revenues, equivalent to funding numerous educational initiatives.
- Consumer behaviour shows a preference for businesses promoting social mobility, particularly among younger demographics.
- Business leaders see potential business performance benefits from embracing social mobility strategies.
The Co-op, in collaboration with the think tank Demos, has unveiled a report elucidating the significant economic repercussions of inadequate social mobility within UK workplaces. This lack of progression is identified as costing the UK economy a substantial £19 billion annually in forgone GDP growth. The findings suggest that economic dynamics could improve considerably if systemic barriers were dismantled.
According to the report, entitled ‘The Opportunity Effect’, enhancing social mobility could lead to £6.8 billion in extra yearly tax revenues. This additional revenue could theoretically finance over 170,000 teaching positions or accommodate 884,000 school places, underscoring the public sector benefits of such economic expansion.
The research indicates that social mobility influences consumer preferences, with 29% of the UK population likely to favour businesses that advocate for it. Among young adults aged 18 to 34, this percentage climbs significantly, surpassing the 40% mark, reflecting a generational shift in purchasing attitudes.
Findings from a survey conducted with business leaders reveal that 76% believe that fostering social mobility could enhance staff attraction and retention. Furthermore, 71% assert that it would positively impact business outcomes, illustrating widespread acknowledgment of the strategic advantage of inclusivity-focused policies.
The report highlights several strategic recommendations for both the Government and businesses. Among these are proposals to legally empower Skills England with the mandate to boost social mobility and the establishment of a government-backed Better Opportunities Fund aimed at co-investing in social mobility initiatives. Additionally, businesses are encouraged to solicit socio-economic information from job applicants voluntarily, aligning recruitment practices with broader social mobility objectives.
Shirine Khoury-Haq, Co-op’s CEO, emphasises the significance of the report, describing it as a pivotal moment in the UK’s productivity discourse. She asserts that removing obstructions to opportunity is not only crucial for economic revitalisation but also essential for enhancing business performance.
In pursuit of broader societal engagement, the Co-op urges enterprises to share their needs regarding support for championing workplace social mobility. The intention is to compile this feedback to create resourceful business toolkits, thus equipping organisations with practical measures to boost social mobility.
The Co-op and Demos report underscores the critical economic advantages of enhanced social mobility, advocating for systemic changes that could boost both fiscal growth and business productivity.
