I’ve always been just a little suspicious of people who advocate social mobility as a cure for society’s ills, as the answer to inequality. It isn’t. When Nick Clegg said last week that social mobility is “the badge of fairness in society” he is missing the point. The very image of “social mobility” is one of those loaded metaphors like “housing ladder” which implies that we can can make it to the top if they have enough drive and are given the right opportunity. This has always been a myth.
And anyway for everyone who goes up, someone has to go down. Maybe it’s just me but I always think about the people stuck at the bottom in the great mobility race. Are they just expendable, socially worthless drones? If so, there’s an awful lot of them. The real issue is not how freely people move up and down the ladder; it’s how far the top rungs of society have pulled away from the bottom ones. Not only are fewer making it to the top, they have to climb a hell of a lot further than in the past. Just look at salaries and bonuses in the City.
The top 10% of society now own 100 times the wealth of the bottom 10%, according to the latest figures from the government’s National Equality Panel, the highest level of inequality since the Second World War. In terms of income the divide is even starker with inequality returning to Edwardian levels. Chief executives of FTSE firms often earn hundreds of times the pay of their lowliest employees. The average chief executive-to-employee ratio in British firms has risen from 47 to 128 in the last ten years alone. That is Labour’s great legacy, along with the record public and private debt.
The existence of this super elite, is an important reason why social mobility is slowing. When fewer and fewer people command more and more of society’s wealth, there are simply fewer places at the top table. Consequently, the competition to get a seat there is ever more intense. Both Conservatives like David Cameron and Labour leaders like Gordon Brown have preferred to focus on equality of opportunity rather than inequality because it absolves them from hard choices about wealth distribution.
You can have increasing social mobility and growing social inequality at the same time. We had it in the 1980s when educated members the baby boom generation discovered the attractions of money and started assaulting jobs in the City of London previously confined to the ex-public schoolboys. This coincided with Thatcherite cuts in taxation that made inequality much greater. New Labour were relaxed about inequality because they accepted the neo-liberal fiction that unequal societies are more efficient at creating wealth. They aren’t, as Canada, Germany and the Nordic and Scandinavian countries have demonstrated. It’s just that the wealth is more evenly spread and therefore less conspicuous.
The reason everyone is talking about social mobility right now of course is because there is demonstrably less of it. On the accepted indices of social mobility it appears that fewer people are moving up the social ladder than in the 1950s and 60s. Economic and class background is an even greater determinant of success today than forty years ago. People offer a number of explanations for this. Some say it is because of the abolition of grammar schools. Some blame child-centred teaching methods which discourage competition and the will to succeed. Sociobiologists hint at an underlying genetic stratification of society.
But the real reason is much more straightforward: the expansion in white collar jobs in Britain in the sixties and seventies as Britain evolved into a post-industrial society. The growth of the state, the corporations and the expansion financial services created a huge demand for middle managers. This meant there were fewer left at the ‘bottom’ - ie in the working class. Actually, a lot of the new middle classes weren’t much better off in the 70s than car workers or miners, when you took housing costs into account, but nevertheless the old class categories seemed redundant as social mobility transformed suburbia.
Now this appears to be going into reverse as computers and outsourcing reduces the demand for ‘knowledge workers’ - in the West at least. The shrinkage of the state bureaucracies, which have been an engine of social mobility for four decades, will suppress mobility even more as governments try to cut debt. Meanwhile, globalisation has created a new, footloose super-elite at the top of society which has managed to commander a disproportionate share of the nation’s wealth. These individuals in financial services, advanced computing and senior management exploit their geographical rather than their social mobility. If taxes go up, they can take their wealth abroad. They can hire expensive accountants to avoid paying it, Wealth has been sucked upwards creating a vacuum of opportunity below.
Social mobility is closely tied into the belief that education is the ultimate solution to inequality. It’s certainly true that educational qualifications are essential for success. But the economic value of a degree has been falling. Only five years ago, the department of education estimated that a graduate would earn £400,000 more than a non graduate during the course of their working lives. This is now down to £100,000, and with so many students cramming into universities, the income advantage is likely to decline further. Only the very, very best will get the top jobs. If everyone has a degree then it’s no longer going to be a booster rocket to upper social quintiles.
But it’s not just about education - never has been. People like Lord Sugar, one of the leading advocates of social mobility, didn’t go to university and have a healthy disregard for paper qualifications. Self made men like him always insist that they’ve worked their way up from the bottom and that if they can do it, anyone can. The reality of course is that only a tiny number of people ever gravitate to the top under their own steam, and they usually have a very lucky break on the way, like appearing in a television show like The Apprentice. The truth about social mobility is that it has always been largely down to accident of birth. What’s much more important is ensuring that society holds together and that the wealthy aren’t allowed to live on a different planet from the rest of us. That means taxation.