Building back better post COVID-19 and the K shaped recovery policy makers are sleepwalking towards.
If I achieve one thing today, I would like you to take a closer look at GDWe.
Carnegie UK Trust just released its report on Gross Domestic Wellbeing (GDWe), an alternative measure to Gross Domestic Product when looking at the economic situation. The report covers England only due to the availability of data but the themes I am sure translate across the UK.
If policy makers focus solely on GDP, then they are continuing to sanction the growth in inequality in UK society.
“We need to boost our recovery from the pandemic with a new way of thinking amongst all kinds of decision-makers. Thinking – and importantly the action it inspires – that places national wellbeing at the centre of the post pandemic recovery plan and extends beyond that. GDWe offers the alternative measure to facilitate this shift in thinking.”
I recently read a report the other day from Ruffer on the “K shaped recovery” that we are going to see as we “build back better” (for some). The K shaped recovery helps GDP on the upside but unfortunately does nothing for GDWe.
Workers on full salary working from home have managed to save on travel, coffees, lunches, and pay down debt while hospitality workers and retail etc have suffered immeasurably and are left unsure about their future. This is the ‘K’ and the difference between GDP and GDWe.
Is society ready for economic output to be measured using GDWe? We have seen during the COVID-19 crisis growing acceptance that something needs to be done to help those who have found themselves left financially disadvantaged through no fault of their own.
We have seen clapping for carers and strong backing for Marcus Rashford in ensuring children are fed properly. Essential workers, the nurses, doctors, delivery people, grocery-store employees etc have won TIME’s 2020 Person of the Year reader poll.
It does seem like society is pulling together and understanding that there is a place for GDWe. This is the Social in ESG investing.
ESG has become mainstream in peoples thinking now. It is good to see a shift in mindset towards carbon neutrality, with investors shifting away from pure profit to profit with purpose.
This is all of course on the upward slant of the “K”. what about for those who find themselves on the downward slant of the K? a focus on GDWe could bring greater hope and opportunity for this section of society left behind and falling farther behind.
Social progress requires greater scrutiny from policy makers to understand the real issues faced under the surface
“Wellbeing is a way to have a different conversation with the public about social progress; a way to identify groups in society who are currently falling behind in all areas of wellbeing; a way to think more holistically – to ‘join the dots’ – between different policies; and a way to make comparisons to identify the areas where social progress is stalling.”
I fear that ‘building back better’ will be building back just the same with the inequality gap rising as a result of COVID 19. There needs to be a focus on the impending problems.
Quotes from The Carnegie UK Trust ‘Gross Domestic Wellbeing (GDWe)TM An alternative measure of social progress’