Ben and I both attended the Social Change Harvard-Manchester Initiative (SCHMi) summer institute in 2010, a joint program between the University of Manchester and Harvard. A core group of SCHMi researchers just released a report, authored by Rourke O’Brien (also of the SCHMi summer class of 2010), entitled Inequality, Instability, and Mobility in Family Life. The report is one of the most comprehensive comparisons of social and economic inequality in Britain and the U.S. to date, examining the interconnections between family background, education, and income over the life-course.
It is well-known that more educated people earn more, and that the returns on a college diploma (and the penalty for not finishing high school) have been growing over time. But these pictures show how much greater the influence of education on earnings is in the United States.
What about mobility? How much do, for example, fathers’ occupational categories correlate with their sons’ positions. For cohorts over the last 30 years, the answer turns out to be remarkably similar in the U.S. and Britain.
Race and sex are important, however. The authors note:
“Aggregate class mobility trends at the national level, however, obscure differences by race and gender. Our research finds that between countries, white men in the United States actually expe- rience lower levels of upward mobility and higher levels of downward mobility than white men in Britain. White women, however, do better in the US than in the UK, experiencing higher levels of upward mobility. Comparing the experience of blacks in the two countries, we find that black men and women both show higher levels of upward class mobility in the US than in the UK. It is important to note, however, that the composition of the black population is quite different in the two countries, as blacks in the UK are typically Caribbean immigrants with fathers occupying higher class positions than black parents in the US.”
There is also the issue of income volatility (how much income changes over short periods of time within a household). This is important because volatility (particularly drops in income) can lead to destabilizing and precarious conditions for families which are sometimes hard to anticipate and insure against.
This picture illustrates how much greater income volatility is for U.S. families. This volatility is particularly concentrated in certain kinds of households — such as single earner families — and the consequences for child wellbeing and material deprivation are only now being understood.
The final chapters draws important implications for policy (read the report for more detail), and suggest a menu of policies to help vulnerable families weather economic shocks, gain educational skills, and ultimately move upward.
One conclusion is that welfare states matter: America and Britain think of themselves as like-minded countries, but one has a much more robust social safety net than the other:
“Although the United States and Britain are frequently lumped in the same basket of Anglo countries lagging behind their social democratic counterparts in Europe, there are clear and systematic differences between the two countries. Inequality is higher in the United States, family and economic life is more unstable, and income mobility is lower. Britain has also been able to take on large-scale programmes of welfare reform that have meaningfully improved the opportunities of children in a way that has not been seen in the United States since the 1960s. If Britain is America’s path-not-taken, then the United States is a cautionary tale for free marketers who would remove the social supports from low-income mothers and their children.”