The majority of people now believe that capitalism is doing more harm than good, as trust in global and national institutions has collapsed, according to a new survey.
Rising income and wealth inequality in rich countries has seen a breakdown in the link between economic growth and faith in institutions such as governments, businesses, the media and NGOs, the research, released on Monday, found.
Public relations firm Edelman polled more than 34,000 people in 28 countries and found that 56 per cent thought capitalism as it exists today was doing more harm than good.
“We are living in a trust paradox,” said Richard Edelman, the company’s chief executive. “Since we began measuring trust, economic growth has fostered rising trust.
“Fears are stifling hope, and long-held assumptions about hard work leading to upward mobility are now invalid.”
The findings are published as business leaders and heads of state fly to the World Economic Forum annual meeting, which begins on Tuesday, in Davos.
Inequality and climate change will be close to the top of the agenda at this year’s summit, which has once again been targeted by protesters.
Rosalina Mueller, a spokesperson for the Young Socialists, which is helping to organise demonstrations, told the Associated Press that Davos attendees had failed to make a positive impact in previous years.
“They say they want to make the world better, but for 50 years they haven’t done anything,” she said.
While faith in capitalism has held up in Asia and the Middle East, Edelman’s survey found that a majority in every developed market do not believe they will be better off in five years.
Fears about the impact of automation, lack of training, immigration and insecure work are all eroding trust, as well as fake news and corruption, Edelman said.
Distrust is being driven by a growing sense that capitalism in its present guise is unfair and that institutions increasingly serve the interests of a narrow elite over everyone else.
Governments have taken a bigger hit to their reputations than businesses, the media or NGOs, with a failure to tackle inequality the most important driving factor.
Just 30 per cent of the general population said the government serves the interests of everyone compared with 57 per cent who said it serves only the few.
Deep-seated fears about the future have helped to foment growing cynicism about the economic system, according to the research.
More than four in five respondents say they fear losing their jobs, citing concerns including the gig economy, a looming recession, lack of skills, cheaper foreign competitors, immigrants who will work for less, automation or jobs being moved to other countries.
This toxic set of concerns has been blamed for the rise of populist, anti-establishment politicians and anti-immigration rhetoric in several countries.
The survey found wealthier, more highly educated groups were significantly more trusting of institutions than the rest of the population. There are now record gaps in trust levels between these two groups in eight countries.
Edelman said that businesses had a key role to play in restoring trust in the economic system. While business as a whole was deemed “competent” by a majority of those polled, it received a negative rating for ethical behaviour such as acting to halt climate change.
“Climate issues are among the most important, and business leaders can no longer brush aside consumer concerns as brands can be quickly tarnished if they are deemed to be unethical,” Edelman said.