Class and socio-economic background have a greater impact on someone’s career progression than any other diversity characteristic, according to research by KPMG.
The consulting firm has published a “progression gap” analysis, looking at the career paths of more than 16,500 partners and employees at the company over a five-year period.
Together with social mobility experts the Bridge Group, KPMG looked at the average time it took someone to be promoted, their gender, ethnicity, disability and sexual orientation as well as socio-economic background.
The latter was measured by parental occupation (of the highest earner in the household when the individual was 15), a common measure backed by the Social Mobility Commission.
Socio-economic background had the strongest impact on how quickly an individual progressed through the firm, with those from lower socio-economic backgrounds taking on average 19% longer to progress to the next grade.
In 2021, the consulting firm became one of the first organisations to publish a social mobility pay gap, making a commitment to increase the number of leaders from lower socio-economic backgrounds to 29% by 2030.
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A quarter of KPMG’s partners (25%) now come from low socio-economic backgrounds, up from 23% last year.
KPMG compared this year’s figures to another report with the Bridge Group it conducted in 2018, which showed that colleagues from an ethnic minority background or are women now progress faster than the average rate of progression, at 12% and 2% faster respectively (compared to 2% and 8% slower in 2018).
However, it detected a recurring “hierarchy of progression” based on intersecting characteristics where those from a lower socio-economic background shared other characteristics. Lower socio-economic background combined with being female and/or from an ethnic minority showed the slowest rate of progression.
This year’s report also looked at the makeup of FTSE 350 boards, revealing that more than 70% of board-level individuals came from a professional background versus just 15% from working class backgrounds. More than two-thirds of those that had reached boardroom positions had benefited from access to networks and mentors.
That said, there was an even split between board members whose parents did not attend university (54%) and those whose parents did, potentially reflecting a small shift in social mobility.
On the back of the research, KPMG has committed to three goals: to review its approach to work allocation, which plays a vital role in progression; to enhance data collection and analysis using new reporting technology; and to tackle the bottleneck of talent to senior roles through a new promotion readiness programme.
Jon Holt, chief executive of KPMG UK, said the study was “pioneering in its scope”.
“As a firm these insights are enabling us to take targeted action and we are publishing our findings so other organisations can draw insights from them and use it as a blueprint to measure and address barriers in their own businesses.
“Socio-economic background is complex and emotive. It requires us to confront how our upbringing shapes the opportunities we have access to later in life. But as businesses we need to lean into this discomfort if we are to make progress. Career advancement should be about realising potential, and not someone’s background or ‘polish’.”
Nik Miller, chief executive of the Bridge Group, added that driving greater social equality was “the defining societal and economic challenge of our time”.
“There remains a proven link between someone’s social background and their educational and employment outcomes and social inequality is estimated to cost the UK £39 billion per year. It is exacerbating lower levels of productivity, poor mental health, and diminishing people’s life expectancy,” he said.
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“Progression is one of the truest indicators of inclusion in an organisation, across all and any diversity characteristics. The more we can highlight and understand the impacts of socio-economic background, including how it affects progression, the more we can create more equal outcomes for all. Talent and productivity must always be the basis for hiring and progression, and certainly prioritised over background.”
Earlier this month, the Social Mobility Foundation published its annual Social Mobility Index, where KPMG ranked third.
