First Global Social Mobility Report 2020

The World Economic Forum (WEF) released its first-ever Global Social Mobility Report on January 20, 2020, to give a much-needed assessment of the current situation of global social mobility paths.

Aim

It aims to identify the characteristics needed to create societies in which everyone, regardless of socioeconomic status, has the equal chance to reach their full potential.

Need

Inequalities have been expanding over the world, despite fast global growth. The growth in inequality has not only sparked widespread social dissatisfaction, but it has also harmed global consensus on the types of economic policies that countries should pursue.

Social mobility has become a critical issue in modern life, and as the index shows, while significant progress has been made in this area, there is still a long way to go.

Concerning the Index-

The World Economic Forum’s Global Social Mobility Index ranks 82 economies based on “ten pillars” that span five important elements of social mobility:

• Health
• Education is really important (access, quality and equity, life-long learning)
• Technology
• a job (opportunities, wages, conditions)
• Institutions and Protection (social protection and inclusive institutions)

The Need for a Social Mobility Agenda to Combat Inequality-

The Index reveals that only a few economies have the proper conditions to promote social mobility, resulting in entrenched economic disparities. The richest 10% of earnings have roughly 3.5 times the income of the poorest 40% of earners in key developed and developing nations.

The Most Serious Global Issues-

The greatest worldwide concerns include low salaries, a lack of social safety, and inadequate lifelong learning systems.

In many nations, the main reason for inadequate social mobility is tied to challenges of economic development that go beyond income, such as educational quality and access, labour market access, bad working conditions, and health inequities. Unless these concerns are resolved, digital leapfrogging will not be possible.

Globalization, the Fourth Industrial Revolution, and Technology.

Globalization and the Fourth Industrial Revolution have brought many benefits, but they have also increased inequality. The Fourth Industrial Revolution, along with the ongoing and future disruption of labour markets, is likely to exacerbate social mobility disparities in nations that are unprepared to capitalise on new prospects.

Improved Social Mobility

If the countries in this research improved their social mobility index score by ten points, it would result in an additional 41 percent GDP growth by 2030, as well as significant social cohesion advantages.

Countries that follow the “stakeholder capitalism” model perform better than those that follow the “shareholder value maximisation” or “state capitalism” models.

Top Performers in Each Country

Denmark comes out on top with an 85.2 social mobility score, followed by Finland (83.6), Norway (83.6), Sweden (83.5), and Iceland (83.5). (82.7).

Low-achievers

Senegal, Cameron, Pakistan, and Bangladesh are ahead of Cote d’Ivoire (82nd rank) on the Index.

Emerging Markets

The Russian Federation is the most socially mobile of the BRICS grouping, ranking 39th with a score of 64 points among the world’s large emerging economies, followed by China (45th), Brazil (60th), India (76th), and South Africa (77th) (77th).

Top Social Mobility Gainer

China stands to benefit the most, as its GDP might rise by USD 103 billion per year, or USD 1 trillion over the next decade. With a gain of USD 87, the United States would be the second-largest gainer.

Significance-

• Benchmarking Tool: The index measures a country’s ability to promote social mobility among its citizens. It assesses the presence of fundamental drivers of equality of opportunity, both old and new, as well as the enabling environment variables that aid in the translation of these drivers into actual social mobility outcomes.
• Policymakers’ Guidance: The Index is intended to provide policymakers and other leaders with a valuable tool to identify areas for boosting social mobility and promoting fairly shared opportunities in their economy and society.
• As part of a global transition toward stakeholder capitalism and equitable and sustainable economies, it attempts to indicate the way toward the necessity for establishing a new benchmark to identify key policy initiatives and business practises focused on enhancing social mobility.

Social Mobility’s Different Facets-

• Intra-generational mobility refers to a person’s ability to migrate between socioeconomic levels during their lifetime.
• The ability of a family group to move up or down the socioeconomic ladder over the course of one or more generations is known as intergenerational mobility.
• Absolute Income Mobility: A person’s ability to earn as much as or more than their parents did at the same age in actual terms.
• Absolute Educational Mobility: A person’s ability to achieve higher degrees of education than their parents.
• Relative Income Mobility refers to how much a person’s income is influenced by their parents’ earnings.
• Relative Educational Mobility refers to how much a person’s educational success is influenced by their parents’ education.

Conclusion-

While considerable advances have been made in some sectors, most notably extreme poverty, the situation in others is deteriorating, as the index illustrates. Globalization and technology are commonly blamed, but as the research points out, there are a variety of causes for this, not least of which is poor policy making, and it is up to a variety of stakeholders to address them.