Why start collecting socio-economic background data on your employees? What specific data should you collect? What does it show you? How do you get started and how can you improve your response rates?
In our latest Employers Masterclass, we discussed the importance of collecting socio-economic background (SEB) data and how it is key to understanding your current position and next steps to take as you build socio-economic inclusion within the workplace. We highlighted that it gives your organisation a way to measure the impact of any interventions you have put in place, enabling you to evaluate your efforts across the employee lifecycle – from outreach and hiring, through to performance and progression, to ultimately exiting the organisation.
We were joined by Neil Morrison, Director of Human Resources at Severn Trent plc, one of Britain’s largest water companies, employing 7,000 staff and impacting on the lives of eight million customers that they supply across the Midlands.
A reason for getting started
Organisations that are serious about building socio-economic inclusion within their workforce realise that collecting data is critical to driving success.
Without this data, how can they tell what interventions are needed and what activities need prioritising? And most importantly how do they assess what is working and having an impact?
For many organisations starting to consider collecting SEB data, it starts with a purpose – and for Severn Trent that purpose is grounded in the communities they serve.
“When I moved from a HR role in the Creative Industries into Severn Trent, it felt like a well-placed organisation to influence the lives of our communities’, Neil explained. “We wanted to understand more about the business – we know that a third of the area we operate across are social mobility cold spots. What we wanted to find out was how many employees we had who represented those communities.
Knowing it would take time for individual employee data to be collected, we actually started by analysing postcodes first – how many employees came from cold spots? We know it is a crude measure but it helped us to understand if we were attracting a diverse group of candidates.
I’ve been in my role for 5 years and we’re still on the journey – you never reach an end goal when it’s ‘sorted’, each year is about making gradual improvements. Use what you can get to start with, to understand what your workforce looks like.”
What are the questions to ask?
The Social Mobility Commission recommends the key question to ask is “What was the occupation of your main household earner when you were aged about 14?”
Responses and how to group responses to this question can be found here in our resources.
Parental occupation is a good proxy for parental income, which has been found to be linked to future attainment. There is much academic literature on the link between an individual’s outcomes and their parent’s occupation.
There are supplementary questions that employers can ask which can show measures of advantage (ie. attending an independent school) or extreme disadvantage (ie. recipients of free school meals). These give you additional nuance to understand your workforce but it is important to note they are not substitutes for measuring social background. Always compare this data alongside parental occupation. Visit our resources to find out how you can use these questions at various points across the employee lifecycle.
We know through our friends at the Social Mobility Foundation that more needs to be done with existing employees – 44% of employers who entered the 2021 Social Mobility Employer Index are not asking any socio-economic background questions to their existing employees. Asking the key question of your existing staff can provide you with invaluable insight.
“We capture the four recommended questions at the point of hire and it is also registered on our HR database”, Neil tells us. “Through that we can track against performance and pay. We have also added the questions to our staff engagement survey – that way we can see how people with different backgrounds feel about the organisation.”
What can the data show you?
“Our data shows us that, on average, those from a lower SEB background are performing better and are better engaged”, shares Neil. “Through looking at our attrition data, we can see that those from a lower SEB have a higher tenure. Diversity and inclusion (D&I) is about getting the best people into the organisation. We are helping the communities that we serve, and we’re attracting a high-performing, engaged, loyal and committed workforce.
Early in my career, someone said to me the issue isn’t about getting the employee on side, it’s convincing their family and friends to say ‘why would you leave this role?’ You want to create beginning-to-end loyalty, so that anyone can develop in the organisation regardless of their background.”
How to encourage colleagues to share their data
The quality and value of the data you collect depends on high response rates. Applicants and employees are more likely to engage with these questions if they see them as part of an integrated D&I strategy.
“For our colleagues”, explains Neil, “It’s still a new diversity question so there has been some hesitance. Interestingly what we have seen is that senior leaders are ok with sharing, they are proud of their backgrounds and what they have achieved. For those coming in at entry level, again, they seem happy to share – they seem more used to being asked for this level of personal data.
It’s those in the middle level who seem to find it more difficult – they are asking ‘why do you need to know, and are you going to judge me – either because I have a high SEB, or conversely, are you not going to give me the opportunity because I don’t have the right educational background’. This is where having a strong narrative around why we are collecting it, what we will use it for (and what we won’t) helps.
Even if people do answer the question but use the ‘prefer not to say’ option – that tells us something – it says they’re not comfortable to disclose. This helps us consider what more we need to do to make people feel they are willing to share.”
It’s important that applicants and employees understand that this data will be stored and used in line with GDPR guideline, and that the data will be aggregated, used anonymously and never to form the basis of individual decisions.
“We use visible role models, who are willing to share their stories to help others to feel less discomfort,” says Neil. “Through them, employees know why we are collecting this data. Our CEO and Exec team have grown up in the communities we serve so they’re supportive of championing this issue. When they share their story it encourages others – particularly at the entry level.
Targets – can they drive the right behaviours?
“Like all aspects of our business areas and strategy, we do set D&I targets,” Neil tells us. “However, we are very clear it is not what we are ‘aiming for’. Targets are milestones rather than goals. This is similar to indices – these are outcomes, not things to aim for in and of themselves.
We measure at various points across the organisation, including experienced hires and executive hire, and a subsection of these levels. We use the data to understand our workforce. You only know you’re operating in a meritocracy if you can measure it.”
Through a question from the audience on how Severn Trent uses this data to improve the employee experience and build an inclusive culture, Neil answered “Aspiration is really important. We run an internal programme called ‘Get That Job’ which helps with confidence and aspiration to encourage people to apply for promotions. People with protected characteristics tend to self-deselect.
We don’t want to hire a diverse workforce, for people with protected characteristics to then not progress. The data shows us where within our organisation this might be the case – so we work with managers to understand more. It’s a constant process within the organisation so people feel confident and competent to progress as far as they want to: access to training and academic qualifications as much as feeling confident in the workplace”.
And the final tricky audience question of “How do you come back at accusations of tokenism when hiring senior leaders from diverse backgrounds?” Neil responded “We want the best – flip that question round on its head – what are the chances that all the best people are white, middle-aged, middle-class men? I would never hire someone because of their background over their capability, but I will look into people from multiple backgrounds in order to find the most capable!”