What is the Global Social Mobility Index?
Launched by the World Economic forum in 2020, it ranks 82 countries according to their performance across five key pillars
Just like all the previous three industrial revolutions, the fourth industrial revolution (4IR) has been a major driver of social mobility as the economies have become more dynamic, globalized and technologically advanced. The biggest achievement of 4IR has perhaps been the emergence of a burgeoning middle class in countries like China and India. But each industrial revolution has come with its own set of problems as well.
While globalization and 4IR have been successful in lifting millions of people out of poverty and raising their standards — the world’s population living in extreme poverty has decreased from 44% in 1980 to less than 8.6% today. However, it has given rise to massive inequality as some countries experienced much more rapid growth than others. This increase in inequality has resulted in the weakening of social fabric, eroding trust in institutions & disenchantment with political processes in these countries.
In this day and age, an individual's chance of succeeding in life are determined by the socio-economic status of the household they are born in. A person’s socio-economic background thus becomes a determining factor in how well they will do in the future. The Global Social Mobility Index focuses on outlining policies so that everyone in a society has a fair chance to fulfill their potential regardless of the socio-economic background, how well-off are their parents or where they were born.
The index benchmarks a country’s ability to foster social mobility across its population. It measures the extent to which fundamental drivers — both old and new — of equality of opportunity are in place as well as the enabling environment factors that help translate these drivers into actual social mobility outcomes. ~ WEF’s GSM Report
To that end, the Global Social Mobility Report 2020 was inaugurated by the World Economic Forum this year, to help policymakers and stakeholders to devise socio-economic strategies which address the challenges of the 4IR and provides a platform for growing, sustainable and inclusive economies that provide an equal opportunity for all.
The first edition of the report ranks 82 countries (infographic below) & covers 51 indicators based on the performance of the following five key pillars:
❶ Health (high-quality healthcare to all the population in a country)
❷ Education (Access, Quality & Equity and Lifelong Learning)
❸ Technology Access (unhindered information access & online learning)
❹ Work Opportunities (Equitable, Fair wages & Working conditions)
❺ Social Protection & Inclusive Institutions
Broadly speaking, the report suggests that on average, most economies were lagging in providing fair conditions to all their citizens to thrive. And a person’s socioeconomic status still disproportionately influences their chances of getting a fair and equal opportunity to succeed. The key takeaways from the report were as follows:
- Nordic countries & parts of Europe outperformed the rest of the World. Not even a single country outside Europe was represented in the Top 10 economies which provided the most equal opportunities to their citizens.
- Canada ranked 14th was the top outsider of Europe in the Top 20, followed by Japan, Australia & Singapore ranking at 15, 16 & 20 in that order. The United Kingdom & the United States were sitting at an abysmal 21st & 27th place respectively. China was at 45 and India was at the bottom tier ranking 76th.
- A new social mobility agenda needs to be implemented to address the problem of inequality becomes a bigger concern — the top 10% of earners have nearly 3.5 times the income of the bottom 40%.
- Data suggested that Low wages, lack of social protection and poor lifelong learning systems as the biggest challenges. Most of the countries performed the poorest in these three pillars — 52.5 out of 100 in fair wages, 58.2 in social protection & 57.0 in Lifelong Learning.
- Investing in the right mix of social mobility factors could produce amazing results. An increase in the social mobility index score by 10 points alone would result in additional GDP growth of 4.41% by 2030, apart from other socioeconomic benefits. This means an increase of $1,026 billion, $867 billion and $428 billion in GDP for countries like China, the U.S & India respectively.
- At the micro-level, companies and businesses must be a part of any plan to improve social mobility for their own employees — by introducing meritocracy, paying fair wages & upskilling through learning opportunities.
- The ongoing automation, changing economic trends & skills demand is exacerbating the inequality among workers in different industries that needs to be addressed, for example, The Media, Entertainment & Information (MEI) industry is the most unequal in the United States.
It is imperative, therefore, that countries create new social mobility pathways for their citizens which provides an equal opportunity to them in a sustainable, growing and inclusive economy.