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We’ve gone the wrong way on social mobility for two decades – Tim Leunig

October 27, 2011

Social mobility means more than whether people are in the same income group as their parents. It also means that the lives of people “below” look more like those “above” them as time goes on.

Most of the twentieth century saw a clear demarcation between blue and white collar workers. Blue collar workers were paid less, and their lives were much less secure. They were more likely to be on short-term contracts – labourers were often hired by the day. Their work involved a greater risk of injury, and thus loss of work. They were less likely to have unemployment insurance and a company pension. The employment conditions for white collar workers were much more reliable – and that, as much as the difference in income, meant that white collar workers were able to buy a house, giving them a security not enjoyed by blue collar workers.

On these measures Britain continues to go backwards. The number of people with a good quality pension has been falling for many years. The government is working on this, but increases in life expectancy make it hard to develop realistic plans that do not scare people off.

The number of home owners is also falling. This is bad news. Almost everyone with the means to own chooses to do so: ownership provides security and certainty that no other tenure can match. Owning your home is particularly useful when you retire and your income falls. As a tenant you may need housing benefit, which puts you at the mercy of rules on allowable bedrooms, allowable rent levels, and so on. The security that is a hallmark of “being middle class” involves owning your own home.

Social mobility, properly understood, means opening up the essential stability of middle class lifestyles to as many people as possible. We made real progress between (say) the 1930s and the 1990s. The proportion of white collar workers rose, and blue collar workers increasingly enjoyed more stable employment, with pensions and the ability to buy a house.

In contrast, we have gone the wrong way on these issues for twenty years. There is a real agenda for action here.

Tim Leunig is chief economist at CentreForum. This article first appeared on Liberal Democrat Voice.

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