Source: COVID Social Mobility & Opportunities study (COSMO).
Notes: N=12,505, including 11,317 in state comprehensive group; analysis weighted to account for study design and young person non-response.

There were not national school closures during the second lockdown (in the autumn of 2020). By the third national lockdown in early 2021, state schools with the most advantaged intakes had largely caught up with private schools’ remote learning provision.

Pupils in these schools were now similarly likely to be offered remote lessons (around 95% in state grammar and state comprehensive schools with the least disadvantaged intakes). But they were still not providing as many per day, with 82% of those in state grammars and 71% in the least deprived state comprehensives reporting receiving more than three online classes per day, compared with 93% in private schools.

On the other hand, state schools with more disadvantaged intakes had made less progress on both fronts – 80% of pupils in these schools reported receiving any online lessons and 53% more than three per day – remaining behind in terms of online lesson provision.

Pupils at independent schools were also more likely to have regular contact with a teacher outside class during lockdowns. Here, state schools caught up slightly in the third lockdown.

But state comprehensive pupils were more than twice as likely to report difficulties in accessing support from teachers than pupils at private schools (17% compared with 8% in the third lockdown).

Pupils at private schools also reported spending more time on schoolwork during lockdowns than their state school peers. This added up to more than one extra working day per week of time spent on schoolwork in both the first and third lockdowns.

Many of these differences are not down to the schools directly. Rather, they are due to challenges faced depending on pupils’ circumstances.

For example, almost a quarter of pupils attending state comprehensives with the most deprived intakes did not have access to a suitable device for joining remote classes in the first lockdown. This figure was under 2% for pupils at independent schools.

Similarly, 13% of those at state comprehensive schools reported issues due to having to share devices needed to take part in online learning. Only 4% at independent schools faced the same issue.

Catch up

Given these inequalities, it is unsurprising that young people at state schools were more likely to think that their progress has suffered because of the Covid-19 disruption. In state schools, 81% of pupils reported this, compared with 72% at private schools. To address this, a much larger effort to support young people in state schools to catch up is needed.

This is especially important as the gap in disruption to learning did not stop with the resumption of in-person schooling. For example, teacher absence has taken a larger toll on state schools in the post-restrictions period of the pandemic.

Staff absence rates due to Covid-19 infections in state schools have been higher than private schools. In a snapshot survey in early 2022, 20% of state school teachers reported that at least one in ten staff in their school were absent. Only 12% of private school staff reported the same (Sutton Trust, 2022).

What have we learned about differences in catch-up activities between state and private schools? Evidence from the COSMO study finds that 53% of young people took part in at least one type of catch-up activity.

This figure was 54% for young people in state comprehensive schools, and slightly lower at 51% for those in independent schools. So, there is some evidence of differential catch up weighted towards the state sector, but it is not large. The definition of catch-up activities is wide, from extra online classes to one-to-one tuition. The latter of these is most likely to have had significant catch-up benefits (Burgess, 2020).

Focusing on the offer of tutoring, this was more likely for young people at independent schools (52% compared with 41% in state comprehensive schools). This is despite the government’s flagship National Tutoring Programme (NTP).

The NTP was meant to target this sort of provision to pupils who needed it most. Unfortunately, its reach was narrower than hoped, with an official evaluation report highlighting that ‘only around a half of school leads and staff felt that all or most of the pupils selected were disadvantaged’ (Lord et al., 2022).

That said, pupils in independent schools were less likely to have taken part in tutoring than those in state schools. Among independent school pupils, 23% said they had taken up this offer, compared with 27% in comprehensive schools. This seems to reflect pupils in private schools being less likely to feel that they needed this help, even if it was being offered. An equally important aspect of pupils’ ability to re-engage fully in their education is their mental health. Pupils attending private schools were more than twice as likely to report that their school mental health support was very good (26%) than state school pupils (10%) (Holt-White et al., 2022)

Figure 2: Whether participant agreed they had caught up with lost learning during the pandemic, by gender and school type

Source: COSMO Notes: N=12,149; analysis is weighted for survey design and young person non-response.

Despite catch-up efforts, pupils at state comprehensive schools were the least likely to think they had been able to catch up (34%). This compared with 58% of pupils at independent schools who felt this way. Almost half (46%) of pupils at comprehensive schools said they had not been able to catch up, while just over a quarter (27%) at independent schools felt the same.

Assessment during Covid-19

Because of the disruption to schooling, the government decided to replace GCSE and A-level exams with teacher assessed grades in 2020 (and centre assessed grades in 2021). Some adaptation was unavoidable, given the Covid-19 restrictions. But many highlighted the importance of retaining externally set and marked assessment (Anders et al., 2021).

Indeed, there is evidence of biases in teacher assessed grades that affect ethnic minority groups, those from lower income backgrounds, boys and those with special educational needs (Burgess and Greaves, 2013; Campbell, 2015). Top grades awarded in the two years in which teacher or centre assessed grades were used jumped up compared with the years before.

But the increase was most prevalent in private schools (Anders and Macmillan, 2022). The proportion of A grades awarded at A-level rose from 44.7% in 2019 to 70.4% in private schools in 2021 (compared with a rise from 24.1% to 42.1% in state academy schools).

Some of this could have been due to the differences in provision highlighted above. Yet, the particularly dramatic fall in grades for private schools in 2022 – a cohort that had more of their education disrupted – casts doubt on this.

We can also use findings from the COSMO study to understand differences in assessment practices between the sectors. Pupils in this cohort received teacher assessed grades for their GCSEs in 2021.

Private school pupils were more likely to say that their teacher assessed grades were better than expected than state school pupils. Likewise, they were much less likely to report that they did worse than expected. As with the changes in grades over time, this suggests a more generous approach to teacher assessed grades in private schools.

Whatever the exact mechanisms, these results represent a significant widening of the qualifications gap between state and private school pupils. This will have had – and will continue to have – significant implications for pupils’ future educational and employment trajectories.

Conclusion

Taken together, we can see that there are a range of ways in which disruption as a result of the pandemic has laid the groundwork for increased inequalities between pupils who attended state and private schools throughout their lives.

Existing gaps have been reinforced by differences in schools’ capacity to implement quick and effective responses at the outbreak of the pandemic.

It seems unlikely that these inequalities have been fully addressed with the fairly small differences in catch-up offerings – pupils themselves reinforce this view. And the use of teacher assessment in the place of usual exams appears to have baked in the results.

We will not know the full extent of the implications of this disruption for years to come. The COSMO study is designed to try to help us to do exactly that.

Some of the differences may unwind. For example, if some pupils’ grades were flattered more by teacher assessment than others, we would not expect this in itself to result in long-term productivity gains and hence to affect individuals’ wages (Wyness et al., 2021). Nevertheless, the knock-on effects (for example, access to university) may still reinforce the educational gap.

Ultimately, the early signs are not promising for inequalities in life chances between state and privately educated pupils as a result of the pandemic. We must not forget about the young people who have been disproportionately affected during this time.

As the pandemic subsides, it is easy to focus on ‘getting back to normal’, but in reality, extraordinary efforts are still needed to try to address these inequalities.

While important in itself, ensuring everyone is given the opportunity to achieve their potential in life is vital to the country’s productivity and, hence, everyone’s future economic prosperity.

This article was first published on the Economics Observatory on 5 December 2022.

Source: Jerrim, 2019

Note: Bars refer to the percentage of teachers who agree or strongly agree with each statement.

Job satisfaction among teachers hit a new low during the pandemic because of increasingly challenging working conditions (DfE, 2022). These were partly due to the impact of school closures on pupils’ learning and development, especially in disadvantaged schools (Blanden et al, 2021).

Evidence on the effects of these non-financial dimensions of teaching on retention is less developed than evidence on financial incentives.

Nevertheless, research suggests that one important influence on teachers’ decisions to leave the profession is the quality of working conditions in their school. More specifically, supportive leadership is one of the factors that is most strongly associated with teacher retention (Sims and Jerrim, 2020).

Teachers identify the quality of administrative support as a key factor in decisions to leave a school. In addition, they point to the importance of school culture and collegial relationships, time for collaboration and decision-making input. These are all areas in which head-teachers play a central role (Trickle et al, 2011).

More evidence is needed on what makes a good head-teacher and how to improve head-teacher quality, as well as selection and training policies. Further research is also needed on retention policies as England suffers from a long-term trend of head-teachers leaving the profession because of the pressures of their job (Zuccollo, 2022).

Conclusion

Low pay and challenging working conditions are the root causes of teacher shortages in England, as well as in many other developed countries. The pandemic and lack of public investment in education have exacerbated this problem over the last few years.

Recent evidence shows that persistent shortages can be reduced through targeted pay supplement policies, as teacher retention is very sensitive to pay. Supportive leadership is another factor strongly associated with teacher retention. More evidence is needed on what makes a good head-teacher and how to improve head-teacher quality, as well as selection and training policies.

This article was first published on the Economics Observatory on 30 November 2022.

Jake Anders is the Principal Investigator of the COVID Social Mobility & Opportunities study (COSMO), and Associate Professor and Deputy Director of the UCL Centre for Education Policy & Equalising Opportunities (CEPEO)

Today marks an important landmark in the COVID Social Mobility & Opportunities study (COSMO) and, with it, our understanding of the unequal impacts of the COVID-19 pandemic on young people’s life chances. After more than 18 months of development and fieldwork, we are releasing initial findings and data from the first wave of this planned cohort study.

Unlike much other research from the pandemic, COSMO comes as close as possible to recruiting a representative group of young people from across the country. This is because it is based on invitations to a random sample of all young people in schools across England, rather than a convenient sample collected for some other purpose who are not, therefore, necessarily similar to the population of young people as a whole. Why does this matter? Having a representative sample gives us increased confidence that our findings paint an accurate picture of the extent and variation in the experiences of this group.

As a result, we are extremely grateful to the more than 13,000 young people across England who responded to our invitation to take part in this study, providing us with details of their experiences to help us build up a picture of the lives of this generation and how it has been disrupted. Through this, COSMO is providing vital new evidence on the effects of the pandemic on the lives of young people, with strong signs that it has severely widened existing educational inequalities: 80% of participants told us their academic progress suffered because of the pandemic’s disruption — a figure that is even higher among those from less advantaged backgrounds. Moreover, there are worrying signs that initial impacts have not been fully addressed by the policy response in this country: only about a third of young people told us they have been able to catch up with their lost learning.

Participants’ views on whether their academic progress has suffered

We are documenting aspects of young people’s experiences during and beyond the pandemic in a series of briefing notes authored by members of the COSMO research team, with the first three of these on ‘lockdown learning’, ‘education recovery and catch up’, and ‘future plans and aspirations’ released today and more to come. These shine a light on important details of young people’s experiences.

Changes to educational plans by COVID-19 status

They highlight, for example, that well over half of young people report some change to their education and career plans because of the pandemic, and that this is particularly the case among those who report more acute direct experiences of COVID-19 itself, raising important questions about the consequences of such shifts if they are realised in the years to come.

They also increase our understanding of barriers to learning in lockdown, helping us to break down the factors that seemed to limit home learning, notably the lack of suitable electronic devices to engage in remote lessons or other online educational activities — this is particularly concerning given that over half of those who lacked such a suitable device told us this need had still not been met at the end of the second period of national school closures.

The extremely rich data from COSMO covering the circumstances and experiences of this representative sample of young people, are now available for other researchers to use to address other vital research questions. COSMO is not just a standalone effort to set out the findings as we see them, but also a resource to support others carrying out research to understand this generation.

But, importantly, COSMO’s ability to tell us about these short-term effects is just the start. COSMO is designed as a cohort study, which means that we aim to continue following the lives of its members over the coming years. Just as we are publishing findings from our first survey, we are just getting started in the process of inviting members of the cohort to take part in the first follow-up. Establishing this link through time will be vital to understanding whether conditions during the pandemic have lasting consequences for decisions that young people make about their wellbeing, education, careers and more. Cohort studies for previous generations, such as the British Cohort Study that continues to follow a group of people born in 1970, have been vital to illuminating our understanding of social mobility in society – extending such understanding to the current generation with their unique experiences completing their education will only become more vital.

Whether or not we think of the pandemic as over, its effects will continue to cast a long shadow, and COSMO will continue to help us to understand this in the years to come.

By Jo Blanden (University of Surrey/CEP, LSE), Matthias Doepke (Northwestern) and Jan Stuhler (Universidad Carlos III de Madrid)

This post was first published on the LSE Covid-19 blog on May 16th 2022, at https://blogs.lse.ac.uk/covid19/2022/05/16/what-do-we-know-so-far-about-the-effect-of-school-closures-on-educational-inequality/

Ninety-four percent of the world’s student population was affected by school and university closures in the spring of 2020, according to UNESCO. By May 2021, schools across countries had been fully closed for an average of 17 weeks. These closures varied widely in length, and were only partially determined by infection rates. Students in many developing nations, and in some US states, experienced closures that lasted more than a year — whereas there were no designated school closures at all in Belarus and Burundi. Closures were particularly long in China, Indonesia, and some countries in Southern Europe, but of similar intensity in most other countries.

School closures have been especially controversial in the US and Canada, where they have continued much longer than in other developed economies. In the US, closures were determined at the state or school district level, resulting in substantial variation in children’s experiences, as well as posing a challenge for the systematic collection of data. Evidence from mobile phone locations indicates that nine out of 10 schools were closed in April 2020, falling to 40 percent in September but then rising again to 56 percent in December of that year.  Halloran et al. (2021) use school district-level data from 12 US states for the 2020–2021 academic year and show that shares of in-person schooling time varied from 9 percent in Virginia to 98 percent in Florida.

Learning is a cumulative process, where skills acquired at one life stage foster further learning later on. This means that learning losses, once incurred, are difficult to compensate for later. Many of the schoolchildren affected by the pandemic are therefore likely to enter adult life with fewer skills and lower educational attainment than they would have otherwise. This loss of what economists call ‘human capital’ will be reflected in lower lifetime earnings at the individual level, and could result in a lower stock of human capital and lower national income at the aggregate level for decades to come.

We are particularly interested in whether school closures increase educational inequality by differentially impacting children from different socio-economic backgrounds. There are two reasons why this might occur. First, the incidence of school closures themselves may vary by social background, for instance when public schools close while private schools attended by richer families stay open. Second, children from disadvantaged backgrounds might experience greater learning loss if their school closes. Children’s learning depends on inputs from educational institutions, parental inputs, and neighbourhood and peer effects. The potential for other inputs to compensate when schools are closed is likely to differ across families.

During the closures, the inputs provided by schools and teachers were often delivered via online education. Yet just how well virtual education can replace in-person schooling depends on factors such as having a reliable internet connection, functioning tablets or laptops, and a quiet work environment, all of which are more likely to be met in higher-income families. Parents also play an important role, and richer parents may not only be more capable of assisting their children in making up for lost time but also more likely to work from home, so they can help if need be.

School closures are not the only mechanism through which the pandemic may impact educational inequality. Its macroeconomic effects could decrease parents’ income and educational investments, reduce public spending on schooling, or affect the returns and incentives to acquiring education. The full impact of all of these changes on educational inequality will gradually emerge over the next few years, but researchers are already offering predictions based on several sources; from pre-pandemic evidence on the consequences of school closures, from early evidence from the pandemic, and from structural modelling of its long-run impact.

The pre-pandemic evidence suggests that COVID could increase educational inequality via two channels: a greater incidence of school closures in low-income neighbourhoods, and a greater learning loss conditional on closure among disadvantaged students. Indeed, early work on the pandemic supports both channels. Parolin and Lee (2021) show that school closures in the US in the autumn of 2020 were more common for students from ethnic minorities. School closures were also more widespread in institutions with lower third grade math scores, more homeless students, more students with limited English proficiency, and a larger share of students eligible for free or subsidised lunch. Halloran et al. (2021) confirm this picture, documenting that districts with a greater share of black students and a higher share of students receiving free lunches offered less in-person schooling.

In the UK, school closures are determined at the national level, but local mitigation procedures led to varying incidence, as groups of children were required to isolate if a positive case was detected in their “bubble.” Eyles and Elliot Major (2021) show that in autumn 2020, these localised measures led to nine days of missed schooling in the poorest areas compared to only two days in the most affluent municipalities. This evidence suggests that variation in the incidence of school closures could exacerbate educational inequalities.

Some alarming direct evidence is emerging on the impact of school closures in the early phases of the pandemic. Engzell, Frey, and Verhagen (2021) find that in the Netherlands, eight weeks of online rather than in-person learning led to 0.08 of a standard deviation lower test scores for students aged eight to 11. The impact is 40 percent larger among those in the least educated homes, suggesting that the pandemic not only increased educational inequality, but that disadvantaged children’s skills actually deteriorated. Tomasik, Helbling, and Moser (2021) analyse improvement in student skills in German-speaking Switzerland over the initial eight-week school closure starting in March 2020, compared to the eight weeks just prior. On average, primary school pupils learned half as much under distance learning, and there was more inequality in their progression. In particular, those with higher ability going into the pandemic saw stronger effects. Students in secondary school learned at the same speed as before.

Maldonado and De Witte (2020) provide evidence on 5th graders in Flemish Belgium who experienced seven weeks of school closure, partially replaced with online teaching. This period led to reduced test scores, equivalent to 0.19 of a standard deviation in maths and 0.29 of a standard deviation in Dutch compared to earlier cohorts. Students performed worse than if they had simply retained their initial knowledge, suggesting a slide in skills. The authors observe weak effects on inequality, with no differences across schools by initial average test scores or by the school’s social mix for math outcomes, and only slightly larger effects for poorer schools in Dutch.

These results suggest that school closures during the pandemic had greater effects on test scores than one might have expected based on extrapolations from prior evidence. Children’s learning may have been affected not just by the school closures themselves but also by other effects of the crisis, such as the disruption of peer interactions or increased anxiety during the pandemic. Improved virtual instruction might have helped reduce learning losses as the pandemic wore on, but uneven engagement has the potential to worsen inequalities even further. Lewis et al. (2021) point to “pandemic fatigue” as an explanation for why they observe more learning loss in the spring of 2021 compared to six months previously, and cite evidence that students were more likely to report not liking school in the winter of 2021 compared to the start of the academic year.

Halloran et al. (2021) show that proficiency rates in English and maths were on average 14 percentage points lower during the pandemic. By associating variation in time spent in different learning modes over the 2020/2021 academic year (remote, hybrid, in-person) with district-level information on test scores, the authors conclude that this gap would have only been four percentage points if schools had remained open throughout the period, though the effects are likely to be downward biased due to missing data. The authors see larger effects in districts with more students of colour and a greater number of students eligible for free school meals.

Underlying the impact of school closures on overall learning and educational inequality are several distinct mechanisms. First, the availability and quality of virtual learning offered by schools is clearly important. Second, there may be differences in parents’ ability to support virtual learning and to compensate for the lost investments from schools. Third, the work put in by the students themselves matters as well. Clark et al. (2021) consider evidence from China and show that children who have access to online learning through their school do 0.22 of a standard deviation better on tests that follow the end of a seven-week period of school closures. While effects by family background are not reported, the authors find that effective online learning is especially beneficial for low achievers. This observation suggests that inequalities in access to online learning may in part drive inequalities in the impact of school closure.

Andrew et al. (2020) survey parents in the first period of English school closures and find that primary school students in the tenth percentile of the family income distribution did about 35 minutes less learning per day than those from median-income families, and 1 hour and 10 minutes less that a child from a family in the 90th percentile of the income distribution. Similarly, Grewenig et al. (2021) and Werner and Woessmann (2021) find that during school closures, low-achieving students in Germany disproportionately replace learning time with less productive activities, such as playing video games.

School closures during the pandemic affect learning through three channels. First, there is a decline in the overall efficiency of skill accumulation because remote learning is less effective than in-person instruction. Second, parents have to replace some inputs that are usually provided by teachers. Parents’ ability to provide these inputs depends on time constraints: parents who are able to work from home during the pandemic have an easier time helping their children with school work than do essential workers who must work outside the home. Third, peer effects and peer-group formation is also disrupted during the pandemic.

Agostinelli et al. (2022) assess the contribution of these channels to educational inequality. All three channels are found to contribute to a widening of educational inequality. While all parents increase their time investments during the pandemic, the ability of low-income parents to respond is hampered by the fact they are much less likely to have jobs that can be done from home. Hence, inequality in parental input increases between high- and low-income neighbourhoods. Inequality in peer effects also rises, in part because children from low-income neighbourhoods lose the ability to meet more high-ability peers at school, and in part because the effect of losing any peer connection on learning is worse for children already struggling in school.

In the US, secondary and public schools were closed for longer periods than elementary and private schools, respectively. Fuchs-Schündeln et al. (2021) predict that the earnings- and welfare losses will be largest for children who started public secondary schools at the onset of the crisis. Welfare losses are smaller for children from richer families, who are more likely to send their children to private school. The authors further suggest that a policy intervention to extend schooling (by shortening the summer breaks in future years) would raise tax contributions sufficiently to be self-financing.

Survey evidence shows that considerably fewer children continued learning activities during school closures in low-income countries, with particularly large reductions in sub-Saharan Africa. Limited education funding and less access to communications technology implies that few children had access to virtual lessons during school closures. Many children essentially received no education at all during prolonged school closures, so that the total learning loss is likely to be severe. Moreover, beyond the size of the learning loss, a given learning loss is likely to have a greater long-run economic impact in low-income countries. This is partly due to demographic reasons. Low-income countries have much younger populations than do high-income countries, which means that cohorts of children finishing school are large compared to the adult labour force.

Commentators on both sides of the Atlantic have called for policy action to help offset the damaging effects of school closures. These primarily focus on what schools can do once children return. Proposed interventions include increased school funding, providing small group instruction, and lengthening the school day or year. All of these have potential, with targeted small group instruction shown to be especially fruitful. Evidence suggests that additional days spent at school raise test scores for poorer students, but the likelihood of diminishing returns means the optimal length of the post-pandemic school year is unclear.

It has already become clear that the pandemic has had a major negative impact on many children’s learning and is likely to have substantially increased educational inequality within the affected cohorts. Tracing the effect of this shock over the following years and contributing to the design of effective policy responses represents an important challenge for future research.

This post is an edited extract from Education inequality: a Centre for Economic Performance discussion paper, by Jo Blanden, Matthias Doepke, and Jan Stuhler, April 2022. 

John Jerrim, UCL Social Research Institute
This blog post first appeared on the IOE blog.

In the third blog post in this series, I started to investigate socio-economic differences in the inputs into young people’s financial skills, focusing upon the role of parents.

Schools, of course, also have a key role in helping to develop children’s financial skills. Therefore, in this final blog of the series, we turn to socio-economic gaps in the provision of financial education within primary and secondary schools.

Big gaps in primary schools

Let’s start by looking at what happens in primary school. Figure 1 illustrates the percent of primary pupils who say they have been taught various financial skills at school, stratified by socio-economic background.

There are two striking results.

First, there are consistently large socio-economic gaps. For instance, children from advantaged socio-economic backgrounds are much more likely to report that they have been taught skills such as working out change from shopping (67% versus 54%), saving money (43% versus 28%), and the difference between the things you “need” and things you “want” to buy (36% versus 27%) than their disadvantaged peers.

Second, it is notable how only quite a small proportion of primary school children are taught some really key financial skills at school. For instance, even amongst higher socio-economic status families, only around one in five primary children are taught about bank accounts, how to keep track of spending and saving, and how to spot that advertising is trying to sell them something.

Interestingly, Figure 2 illustrates how a similar pattern emerges during secondary school as well. This presents the clearest evidence to date that the financial education provided to socio-economically advantaged and disadvantaged pupils differs significantly throughout their time at school. Moreover, some key basic financial life skills – such as learning how to budget, how to read bills, and understanding how borrowing works – are only taught by schools to a minority of disadvantaged pupils.

Figure 1. Socio-economic differences in the provision of financial education during primary school

Figure 2. Socio-economic differences in the provision of financial education during secondary school

With respect to the socio-economic gap in financial education provision during primary school, it is also notable how it seems to increase over time, between age 7 (end of Key Stage 1) and age 10 (nearing the end of Key Stage 2). This is illustrated in Figure 3, which combines responses to various questions into a scale, and reports changes in the socio-economic gap over time as an effective size.

In other words, while seven-year-olds from rich and poor backgrounds report receiving similar amounts of financial education at school, this gap in provision increases significantly during Key Stage 2.

Figure 3. Change in socio-economic status gap in “money planning” education provided to primary school pupils

Notes: “Money planning” includes topics such as saving, how to keep track of spending and saving, how to keep money safe and borrowing from banks.

Increase the focus of financial education in the school curriculum

The above suggests that greater time needs to be made in the school curriculum to provide financial education to young people – particularly those from lower socio-economic backgrounds.

Currently, only a minority of low-income children report receiving any education through their school in some key financial life skills. This puts them at a disadvantage compared to their more advantaged peers, with the gap in provision particularly pronounced towards the end of primary school.

One option could be to integrate financial education skills into the Key Stage 2 tests (with the most obvious choice being mathematics). This would provide schools with a clear incentive to ensure young people develop these vital life skills, which currently seem to be pushed out of the school curriculum.

John Jerrim, UCL Social Research Institute
This blog post first appeared on the IOE blog.

In the previous blog post in this series, I investigated socio-economic differences in young people’s financial skills. This focused upon the types of financial questions that young people from advantaged backgrounds can successfully answer, that their peers from disadvantaged backgrounds can’t.

In this next post, I start to consider socio-economic differences in one of the key inputs into the development of young people’s financial skills – the role of their parents. Are there certain things that higher-income parents do with their offspring to nurture their financial skills, that lower-income parents do not?

Let’s take a look (with further details available in the academic paper here).

Differences in knowledge

Figure 1 presents the percent of parents who say they do various financial activities “often” with their children, divided by socio-economic group.

Figure 1. Socio-economic differences in parent-child conversations and demonstrations of money use

Note: Figures refer to the percentage of parents who report that they “often” talk to or who show their child how to do the following things with money.

Although higher socio-economic parents are slightly more likely to regularly do most of the activities with their offspring, differences are generally quite small. For instance, although high socio-economic status parents are more likely to talk to their child about where their household money comes from than low socio-economic status parents (34% versus 29%) and the fact that advertising happens online (26% versus 23%) there is no difference in – for instance – showing their child how to shop around.

There are also certain areas that lower socio-economic status parents are more likely to talk to their children about, such as the risks of borrowing, the impact of debt, and how they pay for different household bills.

So, on the whole, socio-economic differences in the informal types of financial education parents provide their children are relatively muted. This point is reiterated by another finding from the survey – that the vast majority of parents recognise the importance of teaching their children about money, regardless of socio-economic background (see the top row of Table 1 below).

Where there does seem to be a notable socio-economic difference, however, is in parents’ confidence in their ability to effectively teach their children about money.

For instance, as Table 1 illustrates, more affluent parents tend to have greater confidence in being able to teach their child about how to manage money (65% versus 52%), that they can act as a good financial role model (65% versus 52%) and that they will be able to affect how their child will behave with money in the long-term (46% versus 37%), than disadvantaged parents.

Table 1. Socio-economic differences in parental views and confidence in teaching their children about money

	Disadvantaged background	Advantaged background
% who believe it’s important to teach children about money	85%	88%
% very confident in talking to your child/children about how to manage money	52%	65%
% who strongly agree they can be a good role model for child around money	32%	47%
% who strongly believe they can affect how child will behave around money when they grow up.	37%	46%
% who don’t know how to talk to my child/children about money	13%	13%

Now, such differences could either reflect that (a) higher socio-economic parents are indeed able to teach their children about money more effectively or (b) they are simply more confident in doing so.

Either way, any socio-economic gap in financial skills does not seem likely to be linked to the frequency with which high and low-income parents interact with their children about money – as they report having money conversations and conducting money demonstrations equally regularly. Rather, it seems more likely to be related to low-income parents’ ability to provide effective financial education to their offspring, either through a lack of skills or lacking in confidence to do so.

John Jerrim, UCL Social Research Institute
This blog post first appeared on the IOE blog.

The first blog post in this series illustrated how there are substantial socio-economic gaps in children’s financial literacy skills, with these differences emerging before the start of primary school.

But what exactly can rich kids do – in terms of their financial knowledge and skills – that poor kids can’t?

This blog post takes a closer look.

Differences in knowledge

As part of the Children and Young People’s Financial Capability Survey, young people age 11 and above were asked whether they knew the correct term for various financial concepts, such as “the money people pay to government” (taxes) and “the amount the price of things in shops does up by”.

The percentage of young people who provided the correct response – stratified by socio-economic group – can be found in Figure 1. This provides a clear and consistent story of there being around a 10 to 15 percentage point difference on each of the concepts asked; young people from disadvantaged backgrounds have consistently weaker knowledge across a range of financial concepts.

Figure 1. Inequality in young people’s knowledge of different financial concepts (children age 11 – 17)

How about how money works “in practice”? Young people were also informally tested about their knowledge of how interest on savings work. The exact questions they were asked can be found in Table 1.

Around one-in-three 11-17-year-olds from low socio-economic status families could not work out the amount of money they would have in their savings account with an interest rate of two percent. This is compared to just 14% of children from affluent family backgrounds.

Even fewer disadvantaged children – around two-thirds – failed to understand the concept of a real savings rate, and how inflation erodes the purchasing power. Again, as Table 1 illustrates, the socio-economic gap here is particularly stark.

Table 1. Inequality in understanding interest rates (children age 11 – 17)

	Low SES	High SES
Suppose you put £100 into a savings account with a guaranteed interest rate of 2% per year. You don’t make any further payments into this account and you don’t withdraw any money. How much would be in the account at the end of the first year?	68%	86%
If the inflation rate is 5% and the interest rate you get on your savings is 3%, will your savings have more, less or the same amount of buying power in a year’s time?	31%	53%

 

But what about the consequences of not keeping up with paying important bills? This may have more salience for young people from disadvantaged backgrounds than advantaged backgrounds, given how their parents are more likely to face such financial difficulties.

Interestingly, in this area, socio-economic differences are a lot less pronounced, as illustrated by Figure 2.

Figure 2. Inequality in young people’s understanding of the consequences of not paying council tax (children age 14 – 17)

Almost all children, regardless of their socio-economic status, understood that failing to pay council tax has consequences, and that the government won’t simply pay it for you.

But only around one-in-three understood that this is a criminal offence, which could result in a custodial sentence, with the percentage actually slightly higher for those from disadvantaged backgrounds.  Similarly, only around half of 14-17-year-olds realised that possessions may be seized by a debt collector, with again only a comparatively small difference between socio-economic groups.

Conclusions

Although disadvantaged children’s knowledge of key financial concepts is weaker than their more advantaged peers, they seem to be equally tuned in to the consequences of failing to meet important financial commitments.

Nevertheless, it is somewhat concerning the way there do appear to be significant gaps in disadvantaged children’s financial knowledge. Many cannot work out simple interest rate calculations, with most not understanding that inflation erodes the purchasing power of money. More than half of disadvantaged teenagers also do not grasp the full severity of not paying their taxes due.

Given the potential long-term consequences of such weak financial skills, more needs to be done to improve disadvantaged young people’s understanding of money and how it works.

John Jerrim, UCL Social Research Institute
This blog post first appeared on the IOE blog.

In an increasingly complex financial world, it is important that we ensure young people develop a sound knowledge of financial issues and possess key financial skills. This is particularly important for young people from disadvantaged socio-economic backgrounds who, unfortunately, are the most likely to struggle financially during adulthood and become entrapped in a cycle of poverty and debt.

Yet, in the UK, we know relatively little about children’s financial capabilities, including differences between socio-economic groups, and the age when such gaps start to develop.

Along with Jake Anders and Lindsey Macmillan, I have tackled this issue in a new academic paper. This uses data from the 2019 Children and Young People’s Financial Capability Survey – based upon responses from 3,745 children from across the UK.

Spoiler alert! The gaps are pretty big, and emerge pretty early.

How big are the socio-economic gaps in children’s financial knowledge?

As part of the survey, young people were asked a series of questions that tested their financial knowledge (further detail about the questions asked are provided in the next blog post in this series). We have converted this into an overall score, and then compared the average percentile ranking of children from advantaged and disadvantaged socio-economic backgrounds (where 100 = top 1% of children in terms of their financial skills and 1 = the bottom 1% of children).

Figure 1 presents one of our key findings, plotting results for children from advantaged and disadvantaged socio-economic backgrounds, and illustrating how this changes as children age.

Three key results emerge.

First, the socio-economic gap in children’s financial skills is pretty big. For instance, at age 17, there is a difference between socio-economic groups – on average – of around 14 places in the financial skills rankings (low SES = 55^th percentile versus high SES 69^th percentile).

Second, the gaps emerge early, and then are sustained – but do not seem to grow bigger. For instance, at age 11, there is a difference between socio-economic groups of around 13 places in the financial skills ranking (30^th versus 43^rd percentile). This is essentially the same gap as observed at the end of secondary school.

Finally, the financial skills of 15-year-olds from socio-economically disadvantaged backgrounds are approximately the same as those of 11-year-olds from the most advantaged backgrounds. In other words, poor kids have similar financial skills just before they are about to leave secondary school as rich kids do just after joining.

Clearly, then, the root cause of inequalities in young people’s financial skills is taking hold before children enter secondary school.

But just how early such differences emerge we still don’t really know…

Figure 1. The financial literacy skills of socio-economically advantaged and disadvantaged children (age 11 to 17).

What might be driving this gap?

Figure 1 in many ways replicates what we know about socio-economic inequalities in educational achievement more broadly – gaps emerge early in life and are then firmly maintained.

A later blog in this series will look into the inequalities in the inputs into children’s financial education, both by schools and by parents. This may, in turn, provide some suggestions of the potential factors underpinning this gap in schools.

But at the same time, it’s important to understand that there are unlikely to be easy solutions to such problems. Rather, coordinated action by schools, parents, policymakers, financial service providers and society is likely to be needed if such socio-economic differences in financial skills are to get meaningfully reduced.

Claire Crawford, Laura Outhwaite, Sam Sims and Gill Wyness

It’s finally here: an answer to the question of what the government means by ‘levelling up’. On the education and skills front, it seems to involve some seriously ambitious targets: a massive increase in the percentage of children achieving the ‘expected’ level in reading, writing and maths at age 11 over the next eight years across all areas, with more than 50% rises needed to meet the target in most local authorities. Alongside these national targets, a set of 55 ‘Education Investment Areas’ – roughly the poorest performing third of local authorities in terms of primary and secondary school results – were identified, in which some new (and some re-announced) policies would be targeted.

It is good to have specific, measurable and stretching goals, but given the scale of ambition involved, there was very little detail of how we will actually get there – and no evidence of significant new resources to do it. Complex issues, like inequalities across the life course, require holistic solutions and joined up thinking across all aspects of the journey – things that simply cannot be delivered without appropriate funding. There was also little evidence of the embedding of new announcements within existing strategies – certainly in terms of the plans for educational technology, with the white paper championing the creation of a new online UK National Academy to support schools and children, without embedding this within the wider EdTech strategy.

There were some other glaring omissions as well . . .

Early years

“Potential is shaped from the very beginning of our lives, and all children and families need to be able to access high quality early years education, schools and support.” So began the ‘case for action’ underlying the pledge to ‘eliminate illiteracy and innumeracy’. The statement is correct: the best evidence we have, from both the UK and internationally, suggests that high quality early education benefits children – especially those from socio-economically disadvantaged backgrounds – in both the short-term and the long-term.

But – aside from the reannouncement of funds previously identified in the spending review to expand Family Hubs, the ‘Start for Life’ programme and the ‘Supporting Families’ programme – that was the only mention of early years anywhere in the 332 page document. More time was spent discussing the Roman Empire than the early years sector. Despite pointing out that there are significant regional differences in children’s development by age 5 – differences that are dwarfed by the even larger gaps in development between those who are and are not eligible for free school meals at the same age (18 percentage points: 57% vs 74%) – no mention was made of the crucial role investment in early years could play in reducing these gaps. At a time when the percentage of 0-4 year olds attending early years settings has still not recovered to pre-pandemic levels – with larger drops amongst those from more disadvantaged backgrounds and areas – as well as significant recruitment difficulties and funding challenges, this feels like a significant missed opportunity.

11-19 education

Perhaps the most eye-catching commitments were focused on schools and colleges, although not all of these were new announcements. The reintroduction of retention payments – “to help schools [in Education Investment Areas] with supply challenges to retain the best teachers in high-priority subjects” – was announced at the Conservative Party conference in 2021, and is a reincarnation of several previous versions of a similar policy. More on this below. We also reflect on the promise to “ensure that talented children from disadvantaged backgrounds have access to a college, school sixth form or 16-19 academy, with a track record of progress on to leading universities”.

Teacher retention payments

The government is pledging an additional £3,000 (around 10% of a year’s salary) to early-career maths and science teachers in the 55 Education Investment Areas. (It is not clear yet whether this is per year or in-total.)

Will these retention payments be effective? That depends how we define effective. Similar policies have been shown to improve the retention of early-career teachers in the profession. If teachers can be retained for the first few years of their career, they are then much less likely to leave the profession prior to retirement, so the retention payments probably will increase the overall supply of science and maths teachers in England.

However, a recent systematic review suggests that incentives aimed at keeping teachers in specific schools or local areas are likely to be effective only as long as the policy is in place. It is possible that teachers will move away from the targeted areas when they no longer qualify for payments. Whether – or for how long – the policy will improve the supply of science and math teachers in these areas therefore depends on how long the policy is kept in place. It will also depend hugely on the size of the incentive: clarity over whether it is £3,000 per year across the early-career period, or £3,000 in total – either delivered in a single lump-sum or spread over a number of years – is needed before we can predict how effective this policy might be.

‘Elite sixth forms’

These sound like they could be grammar schools in all but name, given that the school admissions code allows sixth forms to select pupils on the basis of ability. While this might expand educational opportunities for a small number of high achieving students from disadvantaged backgrounds, it is likely to widen inequalities within the areas more broadly. We have strong evidence from the areas of England which still operate large numbers of grammar schools that suggests these systems widen inequalities in attainment during school, in higher education and in subsequent earnings, because while they generally improve outcomes for those fortunate enough to attend the selective schools, they tend to worsen outcomes for those who miss out. The policy also seems somewhat at odds with the government’s recent shift in focus away from higher education and towards the long-neglected further education sector, almost a direct contrast to the aim of encouraging greater parity between academic and vocational routes. Why favour one and not the other here?

Higher education and skills

The continued focus on adult skills is, of course, welcome. Most of the announcements in the white paper are not new – although, to be fair, there was a skills white paper out last year. But many of the initiatives, while potentially promising, are quite ‘piecemeal’, targeting relatively small numbers of learners, and nowhere near enough to reverse the historical declines in either numbers of students or funding per head seen over the last decade. It’s also not clear to what extent some of the more specific initiatives – such as skills bootcamps – are evidence-based.

One new announcement is the Unit for Future Skills, which will champion a more data driven approach to identifying skills gaps. This has the potential to improve the ‘matching’ of workers and jobs, potentially leading to higher productivity in future. But they will have their work cut out for them, as we don’t know a whole lot about the skills people have (other than their qualifications), or which specific skills employers struggle to recruit or find difficult to train. We will watch this space with interest . . .

The role of the university sector – often lauded as an engine for regional growth – was limited to a few mentions here and there, although it sounds like it will benefit from increased funding for R&D.

Final thoughts

The white paper emphasises the importance of place in its version of levelling up. If successful, this means that the average difference in outcomes across areas may fall. But it is worth remembering that inequalities in outcomes, including education outcomes, tend to be larger within areas – between different groups – than across areas.

The education and skills policies outlined in the white paper make a reasonable attempt at targeting the benefits towards more disadvantaged individuals living in the Education Investment Areas. But of course there are plenty – indeed the majority – of individuals from disadvantaged backgrounds living in other areas, whose outcomes are far lower than those of their better-off peers. We must ensure that the political focus on the levelling up agenda does not displace any of the much-needed support for individuals from disadvantaged backgrounds, regardless of where they live.

Claire Crawford

The pandemic has disrupted life for everyone, but children and young people have seen perhaps the biggest changes to their day-to-day lives, with long periods spent away from school and their friends leading to significant rises in mental health difficulties and a substantial reduction in learning. Moreover, these challenges have not been felt equally: the evidence suggests that the pandemic has also led to a rise in inequalities between children from different socio-economic backgrounds, from the early years through to secondary school and beyond.

A budget and multi-year spending review delivered against a backdrop of the highest peace-time borrowing levels ever, and by a chancellor on a ‘moral’ mission to limit the size of the state, was unlikely to deliver the sort of investments in education that Sir Kevan Collins hoped to see when he took the role of ‘catch-up tsar’ earlier this year. But what did it deliver for education? And is it likely to help roll back the rises in educational inequalities that the pandemic has generated?

Early years

While it is positive to see some recognition of the need for a higher funding rate to be paid to early education providers to cover the delivery of the early education entitlements for 2, 3 and 4 year olds, the amount earmarked – £170m in 2024-25 – does not represent the substantial investment that many in the sector have been calling for: certainly nowhere near the £2.60 per hour increase that was estimated to be needed to fully fund the entitlement, enabling providers to deliver these hours without incurring a loss, or by charging for ‘extras’ (such as food or nappies) or increasing fees for other children in order to cover costs.

We await the details of exactly what this means for the official funding rate per hour. Still, for some idea of scale, spending on all early education entitlements – the universal 15 hour entitlement for 3 and 4 year olds, the additional 15 hours for 3 and 4 year olds via the extended entitlement, and the 15 hour entitlement for disadvantaged 2 year olds – was around £3.8bn in 2019-20. 170m represents less than a 5% increase on this figure. Putting it another way, in 2019-20, a total of around 1.75 million children were benefitting from each of the free early education entitlements. If the number of children taking up these places was to remain unchanged between 2019-20 and 2024-25, this suggests that early education providers would only receive around £100 per year more per child than they do now. In reality, the population of 2, 3 and 4 year olds is expected to fall over the next few years, which – when coupled with the reduction in take-up of the early education entitlements that we have seen over the course of the pandemic – may mean that the actual increase in funding rates is higher than 5%. But not much higher.

Likewise, while greater investment in family support services is also welcome, the much-trumpeted £500m increase represents less than half of the reduction in spending on Sure Start Children’s Centres that has taken place over the last decade, falling by over £1bn (around two thirds) in real-terms from a peak of around £1.8bn in 2009-10. A start, perhaps, but not the transformative ‘Start for Life’ that the rhetoric surrounding this announcement would suggest.

Schools

Yesterday’s announcements on schools were dominated by the news that school funding would return to real-terms levels last seen in 2010. Not much to write home about, you might think. But there was also only a small amount of additional money for education catch-up, including an increase in the ‘recovery premium’ – catch-up money targeted towards pupils from lower income families – for secondary school pupils. While it is positive to see funds being targeted towards the pupils most in need of support, our work has shown that the differences in remote learning experiences while schools were closed to most pupils varied substantially by socio-economic background, and whether the roughly £5bn allocated to catch-up will be enough to redress the balance is unclear. It certainly amounts to a lot less than is being spent per pupil in other countries.

Further and higher education

Despite rumours circulating in the media, the decision on the funding of higher education was kicked into the long grass yet again, with the words ‘higher education’ mentioned only three times in the Budget and Spending Review document, and more information promised “in the coming weeks”.

Meanwhile, the eye-catching nominal and real-terms increases announced for further education (FE) and skills look decidedly less generous once account is taken of the fact that we are about to experience a massive increase in the population of 16-19 year olds. The document itself acknowledges that while there will be a 28% real-terms increase in 16-19 funding in 2024-25 compared to 2019-20, this will only maintain – rather than increase – funding per student in real terms. Despite a much greater emphasis in policy discourse about the importance of further education and adult learning than we have seen in recent years, this settlement does not suggest a transformation of the fortunes of the FE sector, which caters to the majority of each academic cohort and in which young people from lower socio-economic backgrounds are over-represented.

Implications for inequalities

Perhaps contrary to expectations, yesterday’s spending review contained increases in spending for most government departments, paid for by the highest tax rises in nearly 30 years. But given the significant challenges posed by the pandemic for children and young people, the Department for Education’s budget will be only a little higher in 2024-25 than it was in 2009-10, while the Department of Health and Social Care budget will have increased by over 40%.

The thinking seems to be that children will catch-up over time anyway. But the evidence suggests that inequalities in educational attainment only increase as children get older: higher socio-economic status parents can provide more opportunities for learning – through better schools, tutoring or more academic and non-academic enrichment activities – than lower socio-economic status parents, and these investments cumulate over time, widening the gap between those from different backgrounds. The same will be true of parents’ ability to support their children to ‘catch-up’ on what they lost during the pandemic.

Without significant government investment to support children from more disadvantaged backgrounds, the wider inequalities that have opened up over the course of the pandemic are likely to foreshadow even greater inequalities in future. Yesterday’s spending review offered some support – but nowhere near enough.