The growing importance of social mobility considerations for employers

As shown in a recent YouGov poll carried out for the UK’s Social Mobility Commission, over half of adults believe the coronavirus pandemic has increased social inequality and widened the gap between social classes.

While no country yet has legislation aimed at improving social mobility, it is becoming a key topic for regulators and employers alike.

What is social mobility?

Social mobility is defined as the link between someone’s occupation or income, and the occupation or income of their parents. If there is a strong link between the two, social mobility is low. A weak link shows more social mobility.

Past research has suggested that those countries with more income inequality also have lower levels of social mobility. This includes several major developed nations; in 2010, a report produced for the UK parliament said rates of social mobility were lower in the UK than in many other developed countries.

Although social mobility is recognised as an issue of concern in many countries, to date there have been few concrete initiatives aimed at resolving it.

Social mobility in 2022

Social mobility has hit the headlines in the wake of the pandemic, but it has been on the agenda for longer.

In the UK, a May 2021 report focused on the socio-economic background of the civil service found that only 18% of senior civil servants came from lower socio-economic backgrounds and that there was an issue for those from a lower socio-economic background progressing within the service.

The financial services regulators then produced a diversity and inclusion (D&I) discussion paper, which acknowledged that more needed to be done to drive social mobility particularly within senior roles in the financial services sector. The regulators said that meant looking beyond the protected characteristics outlined in the Equality Act to take into account other factors, including socio-economic background.

Meanwhile several of the ‘Big Four’ accountancy firms have recently reported on their class pay gaps. That analysis has driven clear targets being set to improve representation of those from a lower socio-economic background in senior leadership roles.

A proposal to make ‘socio-economic disadvantage’ a protected characteristic for employment law has been on the Irish agenda for some time, but is yet to become law. In other countries such as France, Germany and the Netherlands, social mobility is beginning to become a topic but is currently not on the legislative agenda.

In Spain, a legislative initiative currently being discussed in the parliament impacting employment relations amongst others, which could positively impact social mobility.

The spotlight on social mobility is only likely to continue, making it a good time for employers to start thinking about social mobility within their own organisations. Real progress on diversity issues such as this can be slow.

What should employers be doing?

While legislative initiatives to improve social mobility are awaited, employers can take actions which could have a direct impact on individuals.

The first thing for employers to look at is around recruiting talent and thinking about creating diverse routes into the workplace if they are not already in existence. This may involve, for example, using apprenticeships with a formal progression structure in order to attract a more diverse range of candidates into the business.

Contextualised recruitment tools can also allow the employer to take into account the wider context in which a candidate’s academic attainments or experience was achieved – for example, when an individual graduated at the top of their year group from an underperforming institution, while also caring for a disabled parent and holding down a part-time job.

Employers should also look at retention by reviewing promotion and work allocation processes to ensure that these are as inclusive as possible otherwise there is a risk that the diverse talent that has been recruited into the business leaves because the pathway to the next stage is not clear for them.

Networking is another important element. Those from a more privileged background are likely to have had a ready-made network which they could tap into via their parents or wider family, so employers should be wary of putting too much emphasis on requiring employees to have an established network early on in their career. It can take more time for those from a lower socio-economic background to grow that network.

Training is another element which employers should be conscious of. In France, employers have a general obligation to train their employees to help them carry out a specific role, and must also carry out an annual negotiation on wages. These requirements can help minimise inequality in the workplace.

The other critical part of this is looking at the wider relationships the employer has with schools, universities, and other educational institutions to help broaden horizons which, in time, then opens up opportunities to recruit from a wider pool of talent.

With these relationships there does need to be a sustained level of engagement so that these types of partnerships are meaningful to both the individual and the business but also contribute to an organisation's wider environmental, social and governance strategy in its local communities.

Monitoring social mobility improvement

Employers committing to making a difference in social mobility need to know if they are improving. The key starting point for employers, as is the case with all diversity strands, is an effective data gathering exercise to understand the demographic of the workforce, for example by integrating social mobility data into an annual D&I questionnaire.
The key data points would vary depending on the jurisdiction, but could include information like the type of secondary or high school an individual attended, their parents’ occupation, their level of higher education and any eligibility for support such as, in the UK, free school meals.

Some of these data points would be less relevant in some jurisdictions; for example France and Germany have strong free education systems which provide equal chances to all, regardless of their backgrounds.

These categories of data are important because they essentially help measure economic disadvantage which can then play a part in individuals securing roles, but also progressing within the organisation. It is key to communicate to the workforce the reason for collecting this data, which can often be quite sensitive.

Ultimately, any data collection exercise will only ever be as good as the data that employees are willing to volunteer. It’s also important that employees understand how the employer will use the data alongside ensuring compliance with data protection requirements.

The key for employers is not to wait until they are forced into action on D&I issues like social mobility by legislators, but to be proactive on social mobility. There are benefits to the business as well as its employees from having a more socially diverse workforce.

Co-written by Laura Starrett of Pinsent Masons.

Pinsent Masons is running a webinar on 20 April 2022 looking at HR issues around recruitment and retention and the firm’s own role as a responsible purpose-led business within the communities in which it operates