Justine Greening: "The link between effort and reward has broken down"

The UK's poor social mobility should worry businesses, says the former Education Secretary, not least because a lot of MPs see them as part of the problem.

by Adam Gale
Last Updated: 30 Sep 2019

Social mobility may sound more like a matter for policymakers than business people, yet social immobility, where a person’s class background interferes with the realisation of their potential, costs businesses money and makes us all poorer. 

In fact, according to Professor Lee Elliot Major at the University of Exeter, even a modest improvement in the UK’s social mobility would lead to an increase in GDP of between two and four percent.

"The UK has lower social mobility than many other developed countries. It suffers stickiness particularly at the very top and very bottom. Around 50 to 60 per cent of leading people come from private schools only accessible to those who can pay their fees, and around 20 per cent of children leave school without basic literacy and numeracy skills," says Elliot Major.

This results in a shallower talent pool from which businesses can draw their competitive strength, he explains. "In more mobile societies, jobs are filled by those with the highest level of potential to perform well in a role, rather than those who are better connected: wasted talent costs dearly."

Former Education Secretary Justine Greening, who came from a working class background in Rotherham, embarking on a successful career at PwC before entering Parliament in 2005, puts it more starkly: "The link between effort and reward has steadily broken down. People talk about getting a lucky break, but Britain won’t succeed if our strategy is getting a lucky break. We can’t continue to be a country that only uses about a third of our human capital."

Fear of missing out on top talent is one reason many firms have invested heavily in improving diversity in the workplace, albeit with mixed results. Another is concern over groupthink – the idea that people from similar backgrounds are more likely to think similarly, and therefore less likely to spot potentially catastrophic errors.

Yet the focus of diversity programmes has overwhelmingly been along the lines of gender, sexual orientation and race, usually in that order. 

Class diversity is rarely mentioned. Why would it be, when so many of today’s captains of industry themselves came from relatively humble backgrounds? It’s not at all hard to find chief executives born before about 1975, for example, who were the first in their family to go to university.

Baby Boomers and Generation X benefitted from a huge increase in absolute social mobility between the 1970s and 1990s, driven less by the much vaunted grammar school system as by the concurrent proliferation of white-collar jobs and university education, which expanded twenty-fold between 1950 and 2010.

Great opportunities arose. Between 1979 and 1989, the proportion of chairmen in the UK’s biggest businesses who attended state schools doubled from approximately 35 to 70 percent. But now the upward conveyor belt has stalled.

The government’s Social Mobility Report 2019 found that people with better-off parents were still 80 per cent more likely to end up in professional roles than those from working class backgrounds. Research by Daniel Laurison and Sam Friedmann, meanwhile, found that even among such professionals, those whose parents had manual jobs earned 20 per cent less than those from higher socio-economic backgrounds. 

And while the share of FTSE 100 CEOs attending private schools has dropped over the last few decades, this can largely be attributed to the internationalisation of UK executives. The trend is not improving. 

"There will always be exceptional climbers, people who make it to the top despite adverse circumstances, but we know that on average it’s less likely in current generations than those in the past. Someone with the same talents and hard work will be less likely to make it today than in previous generations," says Elliot Major.

More equal access to education is clearly part of the solution, but both Elliot Major and Greening are adamant that it is not sufficient. The same goes for other acts of policy, whether free childcare for underprivileged families, or an end to the unconditional university offers that favour middle class applicants. 

Business has an essential role in addressing social immobility, argues Greening, who set up the Social Mobility Pledge in 2018 to support firms trying to improve access to talent from working class people. So far over 300 organisations from Sainsbury’s and BP to the Cheshire Wildlife Trust have signed up, collectively employing over 2.5 million workers.

There are various things that businesses can do to improve their access to talent, from developing links to local school and opening their doors to work experience placements (extending beyond the CEO’s nephew...) to thinking hard about how they choose to define or measure talent.

The idea should be challenged that a person’s ability is contained in their academic transcript, says Greening. "I spoke to one major accounting firm that said there was zero correlation between academic results and how successful people were in the company," she explains. 

"What were correlated were early experiences overcoming a setback in life and learning that there’s a relationship between hard work and reward, such as by doing a Saturday job or paper round." 

This doesn’t mean ignoring academic results entirely, but putting it into context when hiring - 3Bs from Eton might not tell you the same about a person’s potential as 3Bs from a bottom-quartile comprehensive.

The rewards for business can be significant, says Greening, but so can the penalties if it fails to act. 

"It’s worried me over the last few years how a lot of MPs frame business as a problem to be fixed. There is a level of inequality of opportunity that is unacceptable politically and I believe employers need to show that they’re part of the solution. If they don’t, then I’m sure future governments will be asking how they can make them do a better job."

Image credit: Jack Taylor / Stringer via Getty Images

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