A report released by Co-op in association with researchers Demos, reveals greater social mobility could increase UK business profits by £1.8bn per year.
This could generate £6.8 billion in yearly tax revenues for the Government from additional economic activity. Using regression data analysis, the report identifies the potential estimated benefits are comparable to adding 540,000 new jobs to the economy or increasing private sector GDP by 1.5% – equivalent to adding a city the size of Glasgow to the economy.
The report comes as Co-op calls on the Government to accelerate its commitment to make socioeconomic background the tenth protected characteristic under the 2010 Equality Act. It also finds that if employers were to take-up five strategies that support greater social mobility, this could equate to a £1.8bn rise in private sector business profits.
The report goes on to make a series of recommendations to the Government and businesses to promote social mobility and improve how the private and public sector work together. These include giving Skills England a statutory responsibility to increase social mobility, a government backed fund, consultation with large employers on increasing minimum training and skills expenditure, lower business rates and more.
Shirine Khoury-Haq, CEO of the Co-op, said: “This report marks an important moment in the UK’s productivity debate and puts social mobility at the heart of that discussion. It shows that breaking down barriers to opportunity can be a much-needed boost for the UK’s economy and for business performance. The benefits are too great an economic prospect to ignore.”
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