What is socioeconomic background?

We all have a socioeconomic background. It’s a balance of social and economic factors, which for many people they have no to little control over.

Socioeconomic background or status relates to a collection of factors about an individual. It can be determined from the individual’s income, occupation and social background.

This can include your family and guardianship scenario and the location you’re born and raised, which can mean that education, funding, and opportunities available to you can vary. These life experiences can massively impact a person’s life, lifestyle and achievements.

In essence, our population is heavily divided, meaning some people are disadvantaged with a lack of opportunity. In the UK, we have some of the lowest rates of social mobility compared to our counterparts in the developed world.

It can be a measure of a person and their family’s access to resources and social positions.

Understanding the types of socioeconomic status

Typically, in the UK we break down socioeconomic status into three levels; high, middle and low, sometimes known as working, middle and upper class.

However, the largest survey of its type in 2013, suggests the UK population can be divided into 7 social classes:

• Elite
• Established middle class
• Technical middle class
• New affluent workers
• Traditional working class
• Emergency service workers
• Precariat, or precarious proletariat

Socioeconomic class is intersectional with all and any other identities, which places even more barriers between opportunities and success.

As a result, many people who belong to minority groups can have internal imposter syndrome.

Even when you’ve hired and retained a diverse workforce, internal and external factors can still play a large part in this feeling.

It’s something that is important to have an awareness of if you’re planning to produce initiatives to support socioeconomic diversity.

What is social diversity in the workplace and why is it important?

No matter your organisation, business, charity, or NGO, people are your biggest and most valuable asset.

Yet, we know that throughout the processes of recruiting, hiring and promotion talent and opportunities are being missed.

From a business point of view, hiring a diverse socioeconomic workforce makes sense. Data shows that employees from a low socioeconomic background perform on par with, if not better than, their middle to higher socioeconomic level colleagues.

Not only that but bringing in a variety of social backgrounds and truly having socioeconomic diversity in the workplace means your organisation truly understands the experiences and barriers of the people they work for whether that’s customers or clients.

Research also shows that those from lower socioeconomic backgrounds build better relationships internally and externally as they understand people from all walks of life.

A commodity and skill that you simply can’t buy with training, only life’s experiences.

Where does social mobility fit in with inclusion and diversity?

Social mobility is a phrase that’s being used more and more, but what does it mean? It’s identifying and removing the barriers that people experience because of their socioeconomic background and making sure that doesn’t determine their future.

Social mobility work is getting more popular in the inclusion space. By popular we mean, we’re seeing people collect more data in this area, considering barriers for customers and colleagues in accessing and advancing in their careers.

If you’re reading this as an I&D colleague, statistics show that you are likely to have your colleagues’ support in addressing these barriers as 4 in 5 adults believe there is a large gap between different social classes.

Especially since covid-19, as 56% of the public believe the pandemic has increased social inequality. (Source: Social Mobility Barometer 2021.)

Many organisations are starting to acknowledge the benefits of I&D in the workplace, not only to increase innovation, but also profit. A diverse workforce brings different people with different ideas, so innovation is inevitable if people have varying experiences and backgrounds.

Not only does it make business sense, but it’s the right thing to do. This is also the case for social mobility.

Sandra Wallace, Social Mobility commissioner and Joint Managing Director UK and Europe, DLA Piper says,

“Embracing social mobility isn’t just the smart thing to do, it’s the fair thing to do. Improving socio-economic diversity in the workplace is just as important as all other inclusion and diversity initiatives”

 Some tips on where to start your journey with social mobility

• Collect the data – investigate who makes up your workforce.

• Use this data to support initiatives but also to measure employee satisfaction.

• Explore your employee life cycle.

• Listen! Hear your colleagues’ experiences and barriers – then see how you can remove them as an employer, if not for them, but for the future.

• Make a commitment – aim for some targets in terms of representation.

• Communicate your commitment – why it’s important, how it’ll benefit the organisation, how you’ll get there?

• Opportunity – can you upskill, train, and give opportunities to colleagues?

• Outreach – support the future pipeline. If you already work with schools and other educational providers – can you explore socio-mobility here further?

Check out these resource for more details on how to take your initial steps or your next ones:

Why social mobility is often overlooked – Inclusive Employers

How Inclusive Employers can help with socioeconomic diversity

Organisations we work with are at very different points in their journey on exploring and tackling socioeconomics and class diversity but are also developing opportunities. We can help with your thinking, planning and execution.

Have a listen to our podcast about race and social mobility, which focuses on how employers can take real action to improve social mobility for young people.

To find out more ways in which Inclusive Employers can help, get in touch today.

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In the UK, socio-economic background makes a big difference to the type of career people will have access to, and consider for themselves. What’s more, research on the divide between the wealthiest and poorest shows the gap to be widening. By the age of three, poorer children are estimated to be an average of nine months behind children from more wealthy backgrounds. This is a real blocker on their development which eventually accumulates, evidenced by the fact that 30% of all A* grades at A-Level are awarded to private school pupils (Deloitte).

Children who have a doctor as a parent are 24 times more likely to become a doctor than those who don’t. Children of lawyers are 17 times more likely to go into law and those with parents working in film and TV are 12 times more likely to get into the media (The Class Ceiling: Why it Pays to be Privileged. Friedman & Laurison, 2019). 

And according to recent State of the Nation reports, those from a working-class background that do manage to buck the trend and break into a professional career are still (on average) likely to earn 17% less than their more privileged colleagues. Socioeconomic background is not a protected characteristic under the Equality Act 2010 and so, despite this disparity, people from working class backgrounds do not have the option to bring an equal pay claim.

A further study by the Social Mobility Foundation looked at data on pay, across high earning occupations (Department for Opportunities). The findings showed that gender and race meant there was a double disadvantage faced by some people, for example

• working class women were paid an average of £6,855 than their male colleagues,
• working class people of Bangladeshi heritage were paid an average of £2,994 less than white colleagues
• working class people of Black Caribbean heritage were paid an average of £3,935 less than white peers

It is not surprising this happens when there is a lack of legal protection based on socioeconomic background, combined with a culture in the UK where it is deemed ‘inappropriate’ to talk about our money with others, especially what we are paid. This means people are less likely to know they are being underpaid, or feel comfortable negotiating a higher salary.

How do we improve socio-economic inclusion in our workplace?

The first step is data.

Without good quality data about your workforce, you cannot establish your demographic baseline, identify areas of under-or over-representation, or track your progress over time. While capturing the socio-economic background of your workforce can be a little more complex than protected characteristics such as ethnicity or gender, it is doable. There is now a set of questions that can help you identify employees from lower socio-economic backgrounds, for instance, asking whether an employee received free school meals at state school, and asking their parents’ occupations when they were aged 14.

We often focus on the economic side of socio-economic background, but in recent years are seeing a rise in questions about the social side of this too, for example whether employees are care experienced or care leavers.

Adding two or three questions like this as part of your demographic data will give you a sense of the socio-economic backgrounds of your workforce. Most importantly, it will show whether the under-representation we often see for other discriminated-against groups (e.g. B, Black and Global Majority employees, disabled employees) also applies to employees  from lower socio-economic backgrounds. 

If you’d like help with your data collection, monitoring or analysis, get in touch with your account manager or if you’re not a member, contact us via our enquiry form. 

The second step is looking at your employee lifecycle.

There are steps you can take at each stage of the lifecycle to attract, nurture and retain talent from lower socio-economic backgrounds:

– Think about how you can widen your talent pipeline. Work with your local community to find talent: connect with local schools, colleges and universities. Offer apprenticeships and work placements. Use volunteer days to offer job coaching to local community services.

– Don’t just look at widening the access to more junior roles: how could you use competency-based recruitment and anonymous shortlisting methods to mitigate bias?

– Think about attitudes to talent and potential across the business – your hiring managers may be stuck in a comfortable rut of poor recruiting habits. Watch out for recruiting for ‘fit’ – this often leads to a team of clones, not a diverse range of skilled people. Upskill your hiring managers to hire for talent and potential instead.

– What is your data telling you? Are talented employees who are trying to climb the ladder hitting a ‘class ceiling’?

– Think about the hidden costs of employment. Are employees expected to pay for their travel to work events? Is there an expectation on office time that may be unfair on your colleagues who have to travel further? Is your dress code financially impacting people?

– Do your promotion processes empower candidates to give their best performance? Do they know what you’re looking for and how they can evidence their skill? Recent research from KPMG shows that class background was the characteristic that had the biggest impact on their rates of progression (KPMG, 2022).

– What does your exit data tell you? Often unhappy employees take this as an opportunity to be more open about their experience. Are there any themes relating to socioeconomic background coming through?

What’s the purpose of socio-economic inclusion?

For many of us, the impact of inclusion, including that of people from lower socio-economic backgrounds, is its own reward. However, it brings with it commercial benefits too. There is the positive commercial impact of hiring diverse talent: better problem solving, innovation, fresh perspectives, which are increasingly vital in a complex, fast-paced workplace. Not to mention the cost of getting it wrong: the long term impact on business performance of not attracting talent, the significant risks associated with ‘groupthink’ and stale team cultures, and the financial costs associated with unsuccessful recruitment.

 Many industries are recruiting at pace from a pool of potential employees who are increasingly picky about who they work for. Flexible working, supportive cultures and a commitment to inclusion are becoming non-negotiables for many jobseekers. Recruiting with socio-economic background in mind is a key part of your plan to attract and retain this diverse talent for your business.

If you’d like to connect with our expert team to look at how you can embed socio-economic inclusion into your workplace, get in touch with your account manager if you’re a member or contact us via our enquiry form.

Our members can also access our Social Mobility Package which explores this topic in more detail and offers real practical advice to support you to embed socio-economic mobility alongside all your inclusion efforts.

For tips and advice about Race and Social Mobility, listen to our Talking Inclusion with… podcast.

Reviewed by Courtney Wright, Senior Inclusion and Diversity Consultant

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