Social Mobility and the Economy

Colin Clark Excerpts

Wednesday 28th March 2018 Westminster Hall

[Justine Greening]

I am grateful for that intervention because it gives me the chance to point out that a recent study up in the north-east showed that 83% of young people felt that having work experience should be a compulsory part of the school curriculum. The challenge that they and we face is that there are not enough opportunities for them to do that—it does not matter whether they are growing up in Kent or in Newcastle. Businesses alone can help us to close that gap between the work experience that young people know they need and want, and the opportunities for them to do that while they are going through school.

The final piece of the pledge is about open recruitment practices. Changes such as introducing name-blind recruitment or contextual recruitment can help to promote a level playing field for candidates. In name-blind recruitment, the candidate’s name is replaced by a number and their CV is then assessed as normal. Employers can have unconscious bias in respect of black and minority ethnic candidates, and name bias based on gender and traditional working-class names, so name-blind approaches work. That is why Clifford Chance, a major law company, uses name-blind recruitment—in fact, it is one of the founding companies signed up to the pledge.

Contextual recruitment, which was referred to in the Social Mobility Commission’s annual report in 2016, takes into account the situation in which the academic and personal success of a candidate have been achieved, and how their performance compares with that of their peers from similar backgrounds who have had similar opportunities. It is already used by companies such as Deloitte, and by some of the magic circle law firms such as Linklaters. The research shows that disadvantaged applicants were 50% more likely to be hired using contextual recruitment than they otherwise would have been.

Finally, I am especially grateful for the support of the CBI, the Federation of Small Businesses, the British Chambers of Commerce, and the many businesses that have signed up to the pledge, including companies such as BT, ITV, Adidas, Severn Trent, Viacom, KPMG, Aviva and PwC, to name just a few. The British Chambers of Commerce is encouraging all 75,000 of its members to sign up to the pledge, which is fantastic. Achieving that would be transformational. Similarly, the Federation of Small Businesses is behind the pledge and is encouraging its 170,000 members to commit to it.

[Colin Clark (Gordon) (Con)]

What my right hon. Friend is saying is very powerful. In the north-east of Scotland, we are obviously dominated by the oil and gas industry, but there are skills shortages—they are not necessarily among graduates but among those from a technical college or technical college background. I do not want to overly politicise this debate, but we have to ensure we get the balance right. In my constituency, Aker Solutions and Wood Group—two huge employers—are concerned about getting enough technical and engineering staff. Are we getting the balance of academia—technical colleges and universities—and apprenticeships right?

[Justine Greening]

The short answer is that we do not know, because to date young people have not really had the choices that they want and deserve when they want to follow a technical education route. If our technical education reforms open up that form of education as an opportunity for young people, it would not only be a win for them—young people should not have to stop their education just because they do not want to follow an academic route—but a huge win for British business, which is crying out for the skills these young people want to learn. In launching the pledge today, I seek to knit together those aligned incentives and hopes, so that we can start to unlock opportunity for both young people and businesses.

I will briefly draw my comments to a close. As I have said, with this level of support from companies large and small, I believe that we can work together to have a huge impact. I would also like Members of Parliament from both sides of the House to work collectively to make a difference in our local communities. That is what I will do. I will ask my local companies to commit to the social mobility pledge, and will sign up to the pledge as an employer. We should seek to work on a cross-party basis to galvanise British business, because we know that, when Parliament speaks with one voice, business listens.

I also hope the Government support the social mobility pledge and align cross-departmental policy to help us to go further and faster on social mobility. For example, we could look at how the apprenticeship levy can evolve, whether extending into supporting work experience or focusing on geographic areas that need more investment in training, such as opportunity areas. We can look at the development of degree apprenticeships, which are hugely popular but are in the early days of making the impact that they can make.

In the spring statement two weeks ago, the Chancellor rightly set out how he is asking the Office for National Statistics to assess how we can better value our human capital. That is crucial, because if things are not valued properly, they are not invested in properly. I hope the Treasury can reform even more to shift its decision making to more overtly invest in a socially mobile Britain. That is not just about smarter valuing of our investment in people, but better measurement of our national progress on social mobility and opportunity. That means having a longer timeframe for investments and budgeting, so that when we invest in children and young people, we see the value that it creates over a lifetime and not just over the next five years. Realistically, five years gives little chance for this sort of investment to be demonstrably realised.

In conclusion, it might feel like a huge ask to change the country forever and deliver on social mobility, which we have never been able to do, but it is about a collective effort. It is about lots of people doing lots of things. I am not asking all of us to do everything. I just need us each to make a change in our local communities, whether as MPs, businesses or individuals. It is a start if Putney businesses improve Putney, and if Rotherham businesses improve Rotherham. If the Government back that up with smart policy at a national level, things can change. Tackling social mobility is complex. It is like a million-piece jigsaw puzzle, but people need to do their piece. If we all do that, the picture gets completed. We need to do that to get more opportunities for more young people, so that we have equality of opportunity. I hope the social mobility pledge can be a step along the road to delivering just that.