Big 4 firms spit out all kinds of research — very little of which rates a mention beyond maybe somewhere in a linkwrap if that — but this research from KPMG we’re about to share with you (which we did bury in a linkwrap some weeks back) deserves a callout of its own. Not because it’s so stupid or fluffed with buzzwords, as much as we enjoy calling both of those things out. Nah, this research is actually good, and likely relevant to some of you reading this now. It is especially relevant in the context of the accounting profession’s glaring diversity problem, much of which ties to socioeconomic backgrounds that often prevent people from gaining access to a career path that requires a 4-year degree at minimum. There is progress being made in this area but much work to be done and with the overall talent shortage putting extra pressure on firms, it’s likely the half-assed diversity initiatives of recent years will take a back seat to a wider scramble for any talent we can get for the short term.
Anyway, here’s the research from KPMG UK which uses their own data on client-facing employees to analyze the connection between socioeconomic background and career progression:
Social class is the biggest barrier to career progression, KPMG research finds
Socio-economic background has the strongest effect on an individual’s career progression, compared to any other diversity characteristic, according to ground-breaking research published by KPMG UK.
In the biggest ‘progression gap’ analysis ever published by a business, experts from the Bridge Group analysed the career paths of over 16,500 partners and employees at KPMG over a five-year period. The team examined the average time it took individuals to be promoted, looking at their gender, ethnicity, disability, sexual orientation as well as socio-economic background.
The data showed that socio-economic background, measured by parental occupation, had the strongest effect on how quickly an individual progressed through the firm. Individuals from lower socio-economic backgrounds took on average 19% longer to progress to the next grade, when compared to those from higher socio-economic backgrounds.
For the record, a quarter of KPMG’s partners (25%) come from low socioeconomic backgrounds, up from 23% last year.
Suppose this is a good time to look at how the researchers define low socioeconomic background. Higher socioeconomic background means the individual’s highest earning parent at the age of 14 was in a professional or intermediate background, whereas lower socioeconomic background means the individual’s highest earning parent at the age of 13 was in a manual or blue-collar role.
The research found that senior and junior ranks are the most socioeconomically diverse cohorts, but middle management grades are comparatively less diverse, suggesting there is a bottleneck for those from a low socioeconomic background as they work their way up. Picture an hourglass here, or a “my computer is stuck trying to load a file” icon for those of you who have never seen an actual hourglass. To address this, KPMG is trialing a new promotion readiness program designed to support individuals at a manager grade, who are from historically underrepresented groups and have been identified as ready for promotion in the near-term.
Interestingly, as people climb the ladder, those from lower socioeconomic backgrounds who were promoted from director to partner actually progressed more quickly, compared to higher socioeconomic background.
Let’s throw another blockquote in here:
The report also found a recurring ‘hierarchy of progression’ based on combined characteristics. Where there are intersections between lower socio-economic background and other characteristics, this has a significant effect. Lower socio-economic background combined with female gender identity and/or ethnic minority background is associated with the slowest progression.
If comparing the fastest progressing combination (Asian males from high socio-economic backgrounds) with the slowest (White females from low socio-economic backgrounds), the progression gap is 32%.
The full report “Social Mobility Progression Report 2022: Mind the Gap” can be found here [PDF].