For many growing up in a working-class family, the ladder to upward mobility is not just steep, it’s also missing several rungs. What can leaders do to help?

Social mobility is a term used to describe the movement of individuals, families, or groups through a social hierarchy or stratification system. It often refers to the ability of an individual or family to improve their economic status relative to their parents’ socioeconomic position. If you were the first person in your family to go to university, own a car or buy a property, you have experienced upward social mobility.

Improving our economic status depends on a complex interplay of factors such as our socioeconomic background, gender, race, cultural orientation, and even where we were born. This differs from country to country, and regionally within countries. For example, in the UK, people living with disability and those in rural areas experience the highest barriers to social mobility. Conversely, those with access to good education stand the best chance of improving their socioeconomic status. Whatever the reasons why someone is able to improve their status, economists and policymakers agree that social mobility is a good thing. Societies with elevated social mobility are more equal, inclusive and peaceful, with increased economic growth: think Iceland, Denmark, Sweden and Norway. This is because economies with greater social mobility provide more equally shared opportunities. According to the WEF Global Social Mobility Index 2020 report, “there is a direct and linear relationship between a country’s income inequality and its social mobility score on the index. Low social mobility entrenches historical inequalities and higher income inequalities fuel lower social mobility. Enhancing social mobility can convert this vicious cycle into a virtuous one and has positive benefits for broader economic growth.”

Despite the clear benefits (the WEF estimates that increasing a country’s social mobility index score by 10 points would result in additional GDP growth of 4.41% by 2030, in addition to vast social cohesion benefits), progress globally remains patchy. This is because government policies can only do so much to foster social mobility. Proactive efforts by business can provide the boost that translates government policy into outcomes.

As the UK’s State of the Nation 2023: People and Places report puts it: “Businesses must be a core stakeholder in the efforts around social mobility for their own employees, workers in their value chains and their communities broadly.”

Providing pathways out of poverty

Companies can contribute to improving social mobility through a set of inter-connected priorities that include paying fair wages that allow employees to meet their basic needs and fostering a culture of reskilling and upskilling. In addition, a culture of meritocracy in hiring and promotion would ensure that job applicants and employees are judged on their efforts, skills, abilities, and performance, regardless of gender, race, class, national origin, or sexual orientation.

Inclusive hiring practices: Actively reaching out to underrepresented groups can help bring diverse talents from different backgrounds into higher-paying jobs. This includes offering internships and trainee positions to candidates from diverse backgrounds. Interestingly, many of the best unpaid internships are often in the most expensive cities to live in, which precludes out-of-town youngsters from applying. Companies are urged to consider living and transport allowances for interns to encourage more diversity in terms of providing opportunities to talent from outlying areas.

Education and training opportunities: Improving access to education opportunities throughout an individual’s life is a critical factor for all economies. Education increases the chances that youth will remain socially mobile and not fall back into poverty or pass it on to the next generation. Development opportunities such as tuition assistance, on-the-job training, and access to courses and certifications can help employees advance their careers. Educational assistance programmes for children of employees are also key to breaking generational poverty.

Address digital inequalities in your organisation: 2.6 billion people, one-third of the global population, remain offline. It’s not just low-income countries either. Post-COVID research by Manchester University estimated that there are nine million adults in the UK who cannot use the internet without help. It’s easy to assume that everyone in your company has access to the internet 24/7, or that everyone has a smartphone, or that everyone is equally able to use online tools when working at home. A company culture of transparency and supportiveness will enable people to speak up if they need support using digital tools, or if they need monetary support to improve their internet access. Upskilling in digital tools, from entry-level to advanced, should be easily available to everyone.

Fair pay and benefits: Low wages, lack of social protection and poor lifelong learning systems are the greatest challenges globally. Ensuring fair compensation and providing comprehensive benefits – from health insurance and home ownership to retirement plans - can help create ‘stickiness’ that prevents employees from losing ground. This extends to the gig economy. As the WEF report notes: “Forging a new social contract that provides adequate social protection beyond full-time employment contracts is important across economies.”

Mentorship programmes: Establishing mentorship programmes where experienced employees guide newer or younger staff can make employees from different backgrounds feel comfortable in your organisation, a critical factor for the professional growth of individuals who might otherwise lack access to such guidance. This includes the facilitation of professional networks and the creation of Employee Resource Groups.

Career advancement pathways: Clearly defined career pathways and promotion from within can motivate employees to aspire to higher positions and achieve greater economic success. Supportive work environment: Organisations should pay particular attention to providing talented employees with additional support if they’re being offered a potentially difficult challenge or risk setting them up to fail.

Mental health support: Burnout can lead to employees making unwise career decisions or developing potentially harmful coping mechanisms, both of which can jeopardise their economic mobility. Mental health policies can help.

Supply-chain support: Companies can extend their influence on social mobility beyond their organisation by supporting local entrepreneurs and community programmes focused on education, health, and economic development.

The economic and social returns from investing in the right mix of social mobility factors: Apart from contributing to a more stable and prosperous society, companies that integrate social mobility into their strategic planning also enhance their own stability, competitiveness, and attractiveness as employers.

Increased diversity and innovation: Businesses that actively encourage social mobility tend to attract and retain a more diverse workforce, providing a broader range of ideas, perspectives, and solutions to innovation and problem-solving.

Enhanced engagement / lower churn rates: Companies that invest in their employees’ growth and advancement often see higher levels of job satisfaction, engagement, and loyalty. This can reduce turnover rates and associated recruitment and training costs while fostering a more committed workforce.

Improved company reputation: Businesses that are seen as responsible and equitable often enjoy better brand perception and increased customer loyalty.

Broader talent pool: By removing barriers to entry and advancement for underrepresented or disadvantaged groups, companies can tap into a wider talent pool, finding skilled individuals who might otherwise be overlooked through traditional recruitment practices.

Better market reach and consumer connectivity: A diverse workforce can provide insights into a wider array of market segments, enabling companies to better connect with and serve a broader customer base.

Employee skills development: Investing in training and development helps build a more skilled workforce for the long term, driving operational efficiency and productivity. None of these actions will mean anything though if employees aren’t made to feel welcome. This includes clear policies on bullying and harassment. Exit interviews are littered with tales of overt discrimination such as being mocked for their accents, names, dress or eating habits, as well as more subtle forms of discrimination such as routinely asking female employees to make coffee or take notes, or simply glossing over the contributions of minority team members. Conscious inclusion is the foundation of all successful social mobility programmes.