Ethnic minority employment on the rise, but pay gap persists

According to a study by the Institute for Fiscal Studies, ethnic gaps in employment have “substantially” closed since the 1990s, but wage inequalities persist.

The think tank’s Deaton Review of Inequalities study, published today (14 November), found that differences in ethnic minority employment rates are much smaller than in the mid-1990s, when men black Africans and Bangladeshis had nearly 30 percentage points lower employment rates than their white counterparts. counterparts.

In 2019, that figure was 2 or 3 percentage points, according to the IFS. However, female participation rates differ more markedly between ethnicities, with working-age Bangladeshi and Pakistani women being more than 30 percentage points less likely to be active in the labor market than white British women.

In terms of remuneration, inequalities differ enormously according to ethnicity. Median weekly earnings of black Caribbean men were 13% lower than white British men in 2019, while Pakistani and Bangladeshi men earned 22% and 42% less respectively. However, Indian men’s earnings were 13% higher.

Educational performance for most minority ethnic groups in the UK has improved compared to whites, the IFS found, although people from black Caribbean backgrounds are the exception.

Bangladeshi pupils are now 5 percentage points more likely to get good maths and a GCSE in English than white British pupils than 15 years ago, but black pupils in the Caribbean have still fallen behind.

Students from all major minority groups were more likely than white students to attend university, although the proportion of university students attending the most competitive institutions was lower than that of white British students. The same goes for those who complete their degree and get a good grade.

Heidi Safia Mirza, a visiting professor in the department of social policy at the London School of Economics, said understanding ethnic inequality in the UK was “a moral, political and economic priority”.

“The picture is neither universally positive nor universally bleak,” she said. “Most ethnic minority groups in the UK are doing better than they used to be and are doing particularly well in education.

“On the other hand, most continue to earn less than their white British counterparts, and all earn less on average than we would expect given their education, background and occupation.

“The evidence of discrimination in the labor market is clear and inequalities in wealth are likely to prove particularly difficult to reduce. Policy makers need to understand and acknowledge all of these nuances and complexities if we are to make further progress in tackling remaining inequalities.

The government failed to make ethnic pay gap reporting a legal requirement earlier this year, but said it would help employers reduce the impact of prejudice on underrepresented groups at work .

Professor Imran Rasul, research director at IFS, said it was important to consider the differences not only between the experiences of ethnic minorities and white people, but also the differences between different ethnic groups.

“The differences between the groups are greater than the differences between the white majority and the ethnic minority population taken as a whole,” he said.

“This understanding is a first step towards an effective policy response. We also need to better understand the causes of differences within and between ethnic minorities in the education and justice systems, and in the labor market.

The IFS research was released the same day as data from the Social Mobility Foundation showing a class pay gap of around 13%, an inequality that is accentuated for those who are both ethnic minority and the working class.

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