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Britain's race pay gap is not down to being paid less for doing the same job

A significant ethnic pay gap exists in Britain in 2018. Photo: Monkey Business Images/REX/Shutterstock.
A significant ethnic pay gap exists in Britain in 2018. Photo: Monkey Business Images/REX/Shutterstock.

Britain has a race pay gap problem. But it isn’t down to black and ethnic minorities doing the same job as their white colleagues and being paid less — it’s mostly down to big differences in qualification levels and the types of jobs they do.

Independent British think tank Resolution Foundation surveyed 100,000 people over a decade and the data revealed that black, Asian, and minority ethnic (categorised as BAME) workers, are paid about £3.2bn ($4.04bn) less than their white colleagues annually.

It pointed out that the “pay penalty” between white and BAME workers took into account a variety of factors, including:

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  • Industry sector

  • Occupations

  • Education level and degree attainment

  • Contract types

  • Where they live

The BAME workers that were impacted the most by the pay penalty were black male graduates. The think tank said that they were paid 17% less per hour compared to their white counterparts while Pakistani and Bangladeshi male graduates earned an average of 12% less an hour.

Chart: Resolution Foundation
Chart: Resolution Foundation

Meanwhile, the think tank said that the average hourly pay for some ethnic minority groups, such as Indian and black women without degrees, “did not differ from white non-graduate women’s pay in a statistically meaningful way.”

But Kathleen Henehan, research and policy analyst at the Resolution Foundation said in a statement: “However, once background factors – such as where someone lives or the role they do – were factored in that seemingly non-existent pay gap becomes a statistically significant pay penalty: all things held equal, Indian non-graduate women earned 44p an hour and Black non-graduate women 61p an hour less than their white counterparts.”

Chart: Resolution Foundation
Chart: Resolution Foundation

Over the last year, the focus has fallen on closing the gender gap globally.

The World Economic Forum said in a recently released report that it will take 108 years to close the overall gender gap and 202 years to bring about parity in the workplace.

WEF’s Global Gender Report 2018 warned that while strides had been made in gaining equality in pay and promotions, stagnation in the proportion of women in the workplace had offset reducing the gender gap – hindered further by a decline in women’s political representation and greater inequality in access to health and education.

READ MORE: It will take 108 years to close the global gender gap

In Britain, the UK government made it mandatory for companies with 250 employees or more to publish annual gender pay data. However, there is no such legislation in place for employers to reveal the pay and treatment of ethnic minority workers.

“A record number of young BAME workers have degrees, and a record number are in work,” said Henehan. “However, despite this welcome progress, many…face significant disadvantages in the workplace.”

“If 2018 was a totemic one for the gender pay gap, might 2019 be the year when we pay more attention to the pay penalties faced by black and ethnic minority workers of both genders? From a living standards perspective, identifying and taking action to close the BAME pay gap could bring similarly large benefits to millions of workers,” she added.

READ MORE: The Bank of England wins on work-life balance but still struggles on diversity

A UK government spokesperson said: “We’ve introduced new laws to help companies ensure the make-up of their boards and senior management is representative of their workforces and we’re currently consulting on proposals for mandatory ethnicity pay reporting as part of a series of measures to help employers tackle ethnic disparities in the workplace.”

The Equality and Human Rights Commission said it supported the mandatory reporting of staff recruitment, retention and promotion by ethnicity.

The Resolution Foundation said: “Encouragingly, the government is looking to build on the success of the gender pay gap reporting requirements, and recently published a consultation document asking whether there should be similar pay gap reporting by ethnicity.”

For more on the world of work, download the Yahoo Presents Its a Jungle Out There podcast on Apple Podcasts, ACast, or Google podcasts to listen while on the go.