It’s not who you know, it’s who you don’t know

 By So gesehen.

Public services are scrambling to highlight the value of social capital in helping disadvantaged and vulnerable people cope with the cuts. At the same time, the government disapproves of privileged members of society using their plentiful social capital to their advantage, and seeks to end “who you know” as part of a strategy for social mobility.

We can’t be a cheerleader for social capital only when it serves as a force for equality. To achieve social mobility, rather than entrenched, spatialised, class divides, we need streets, schools, firms, neighbourhoods and cities to be inclusive and interconnected. People, the organisations they work for, and the government which supports them, all benefit when social networks are wide, broad and diverse, maximising access to opportunity.

The last months for many outgoing public sector workers seem to be spent ensuring that the vulnerable might be supported in the future by a Bigger Society. Two months ago I went to an event where commissioners and directors of adult social care said that informal and non-professional support would be the key to maintaining the health and well-being of those with care needs as adult social care budgets are cut. To support the Big Society, in this context, means combating social isolation, and ensuring that vulnerable individuals have a network of friends, family and neighbours – or in other words, people who they know – who could keep an eye out and provide useful services: changing the battery on a hearing aid or providing transport to the shops. It is in these acts of everyday heroics that people are employing social capital. But the intrinsic limitation of the Big Society is that many of those in need of a friendly and helpful neighbour have a limited social network, often made up of people who have similar needs.

Skip to a few weeks later, Deputy Prime Minister Nick Clegg announced a government initiative to end the culture of “who you know” in the workplace. His own organisation announced it was “looking for funding” to pay unpaid interns, and Clegg was criticised as a hypocrite (rather than commended as a progressive) for himself having benefited from an unpaid internship facilitated by his father. David Cameron said it was to be expected that any parent would do anything they could to advance the fortunes of their children; he was relaxed and would continue arranging internships for his friends. If anyone had bothered to ask young people, they might have also agreed that while more apprenticeships might help, they would in fact expect their parents to use all the social capital they had to help. It has probably never been more difficult for school leavers and university graduates to find work.

It’s worth exploring why nepotism makes sense from the perspective of the individuals involved. A few weeks ago I got an email from a friend Kate who publishes magazines. It had been sent to a large group of friends and a lot of people on the email went to university together. People would often rather employ their friends, family and neighbours – or have them as interns – for rational reasons. We want to work with people we like. We trust people we already know. We might think we work best with people who are similar to ourselves. And we may see it as a matter of you scratch my back I’ll scratch yours. But there’s more to it: there was mutual gain in this form of recruitment; Kate had a position to fill. As well as saving time and money in recruitment with a quick, zero cost and risk-free email, Kate was – implicitly – wagering that an employee with a social connection might perform better, because the friendship is at stake.  Kate was investing her social capital in an arrangement of mutual benefit. An employer may think that by employing a friend, that person is likely to be loyal and productive, or at least a low risk of incompetence, neglect or misconduct. And an employee might expect a forgiving and supportive boss in return for bringing their social capital to the arrangement. These perspectives hold for unpaid interns and friends of friends as much as for MPs who employ their spouse.

However, there is a downside to employers employing their friends, or favouring those of a similar background. Evidence shows that organisations are more productive when they have multi-dimensional diversity in their workforce. They benefit from “who they don’t know” more than “who they already know” – because these people bring new perspectives, skills, experiences and knowledge – which is less likely to emerge from your uni chums. Immigrants in the labour market act as a spur to innovation.

So at the same time as pronouncing an end to “who you know” in the workplace, the coalition is asking and expecting people to practise “who you know” in the community. In a Big Society, we would rely on each other – on our social capital, and on “who we know” – a lot more. In both the workplace and in our networks of caring for one another, diverse social networks will serve us better than insular networks of people similar to ourselves.

Addendum: A word on interns. At nef, we are concerned that labour markets (and other markets) operate in a fair and equitable way which contributes to societies with high well-being and social justice. We endorse labour market regulation and intervention which supports these goals, such as the minimum wage - and we’ve got some new ideas; we’ve recently explored what would be possible if the working week was 21 hours. We also operate as a charity, reliant on grants and donations and profits from our consulting team, and like any organisation we are always looking for ways to do as much as possible with the resources we have, and build those resources were possible.

We are in a privileged position when we require new staff, and lots of people write to us asking if they can work unpaid. We call these people volunteers, to recognise that they are making a meaningful contribution to our organisation. We don’t recruit or advertise, and we limit volunteers to three months full-time. In other organisations, these positions are called internships. We have some anxiety that by building the careers of those individuals who are fortunate enough to have resources (e.g. money and accommodation) to support a period of unpaid career-building, we are undermining the socially just labour market that we campaign for. This summer, nef will implement an initiative to pay a London living wage to volunteers.

nef also employs an apprentice, Laura Smith, who works with our reception and administrative team. Next week she will contribute her perspective on this blog.