As pandemic profits soar, it’s time big tech like Amazon keep their promise to give back to society

Not one of the tech giants is among the UK’s top 75 social mobility employers. That is hardly consistent with the rhetoric about ushering in a new era of responsible capitalism, says Alan Milburn

Amazon founder Jeff Bezos committed the company to creating an economy for all. (Getty Images)

The profits of companies like Alphabet and Amazon have boomed during the pandemic. As youth unemployment soars, they must not renege on their promise to society.

Covid-19 has not only been a health disaster, it has sounded the death knell for many businesses. But not all. For some, it has proved to be good business. The tech giants have seen profits soar during Covid-19: the combined post-tax profits of Alphabet, Amazon, Apple and Facebook have grown by a whopping $39bn (£29.1).

The Digital Services Tax is a missed opportunity to capitalise on this windfall by fairly taxing excess profits. Poor policy design means that it is often only small traders selling through platforms like Amazon that will pay more, rather than the tech giants themselves. In the absence of money going to HM Treasury, however, big tech could find other ways of paying back to wider society. Supporting the government’s stalled levelling-up agenda would be a good starting point. Yet the publication today of the UK Social Mobility Employer Index indicates that not one of the tech giants is among the country’s top 75 social mobility employers. Indeed, none of the 119 entries – collectively employing just under 1 million people in the UK – came from the technology sector.    

That is hardly consistent with the rhetoric from major tech firms about ushering in a new era of responsible capitalism. Last year, the Business Roundtable – which includes Jeff Bezos and Tim Cook – committed to redefining the purpose of a corporation away from pure shareholder value towards creating an economy that works for all. Accelerating social mobility should be a central tenet of this commitment. The reasons for elevating social mobility on the corporate agenda to rank alongside existing efforts to improve gender and racial equity have become starkly obvious during the pandemic. The correlation between social disadvantage and Covid-19 mortality rates has exposed the fragility of a society with too much poverty and too little mobility.  

Prior to the pandemic only one in eight children from low-income backgrounds in the UK were progressing to become high income earners as adults. The 20th century expectation that each successive generation would do better than the last is no longer being met. Now the recession is threatening to make young people its principal victims with 60 per cent of the job losses since the start of the pandemic taking place among that cohort. ONS data released yesterday showed that youth unemployment has jumped to 16.4 per cent as a result.  

The government has a key role to play in stemming and reversing this jobs catastrophe for the Covid generation, but so too do businesses, especially the most profitable. By extending beyond their usual recruitment channels, they can not only make a positive societal contribution but also broaden their talent pool. That is what the leading employers in this year’s Social Mobility Employer Index are already doing. It is what sectors like law, the public sector, and professional and financial services have been practicing for some years. It is these firms that sit at the top of the Index. They have been targeting recruitment on social mobility “cold spots” – those parts of the UK with the fewest opportunities – and ensuring parity of esteem between graduate and non-graduate routes into professional employment.  

It is incumbent on companies like Alphabet, Amazon, Apple and Facebook to follow that lead by putting social mobility at the heart of their businesses. Big tech has profited from the pandemic. Now it must make good on its promise to be responsible employers. This is the time for them to invest in the next generation of talent and play their part in levelling up the UK.

The Rt Hon Alan Milburn is chair of the Social Mobility Foundation and a former Labour Party minister.