Because more equal societies work better for everyone

Divided We Fall: UK social mobility held back by inequality

Thursday, 17 December, 2015

The Social Mobility and Child Poverty Commission’s annual State of the Nation report has just been released, and it makes for grim reading. It warns that we are on track to become even more unequal unless the gap between the Government’s rhetoric and the reality of people’s life chances is closed.

While educational attainment among disadvantaged children has improved, at the end of primary school, better-off kids are 30 per cent more likely to achieve national benchmarks in reading, writing and maths. This disparity continues through secondary school, so that poor bright kids do not achieve as highly in their GCSEs as their richer peers, and then must watch those richer pupils enter the most selective universities at far higher rates than they do. Just for good measure, people from disadvantaged backgrounds who make it into top jobs are then likely to be paid less than their counterparts from professional families.

Background simply matters too much: someone who went to a private school is 11 times more likely than the rest of us to become the CEO of a FTSE 100 company, and 32 times more likely to become a senior judge.

The Commission’s evidence on social mobility should be a clarion call to us all. It found Britain has the strongest link between parental and child earnings in the OECD, while other evidence suggests we’re joint second worst with Italy for social mobility, behind only the US. There, the dangerous myth of mobility is propagated by the ‘American dream’ – the idea that anybody from any background can make it to the top, if only they keep their noses to the grindstone and ‘play by the rules’. The UK may not have that same ingrained societal belief in a just world, partly because of our notorious obsession with class, but it’s also clear our scepticism may come from an understanding that many of our economic, political and social systems are deeply unfair and unjust.

So why doesn’t effort reap rewards for everyone? Most of the answer lies in our economic divide. Income inequality is strongly negatively correlated with social mobility, and experts generally agree that there is not just correlation, but actual causation: a wide-ranging review of the evidence carried out by the IFS concluded that it is “likely to be very hard to increase social mobility without tackling inequality”. Close neighbours like France, Germany and Scandinavian countries all have better social mobility than we do, and it’s no coincidence that they are also more equal. 

Since 1979, the income share of the top 1 per cent has more than doubled. Contrast this with the fact the long period of decline in child poverty has now flatlined, leaving 2.3 million children officially classed as poor. The Government is shutting its eyes to the importance of money for social mobility outcomes by pushing ahead with its plan to eliminate income from its official measures of poverty.

Today’s report does point to progress, too: accountancy and law are doing the most out of the professions by having targeted strategies to improve social mobility. But we shouldn’t need to rely on remedial measures when there is good evidence that making people more equal can help tackle the majority of the problem. The Commission itself recommends a more ambitious target to halve the proportion of people who earn less than two-thirds of median hourly pay.

A society that cares more about who your parents are than what you are capable of actively strangles its own supply of talent, damages its economy and – worst of all – dismisses huge swathes of its population. It isn’t good enough to accept millions of children and young people may never reach their potential: so-called equality of opportunity will never make up for the fact the children of poor parents have so few resources available to them. Our politicians and businesses should accept that and tackle income inequality head-on.

Lucy Shaddock, Policy and Campaigns Officer

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