Black women are the least likely to be among the UK’s top earners compared to any other racial or gender group, according to a study.
Researchers from The London School of Economics' (LSE) The Inclusion Initiative (TII) analysed pay over the past 17 years to establish who is among the top 1%, 10% and 20% of earners.
They found that while all women experience substantial differences in pay, hours and representation in top jobs, it is Black women, regardless of whether they are UK born, who have the lowest probabilities of being top earners. While 1.3% of UK-born White men are in the top 1%, it is only 0.2% of UK-born White women and less than 0.1% of UK-born Black women.
Overall, the biggest differences between Black and white women are in banking, finance and insurance.
The analysis used data from the Quarterly Labour Forces survey from January 2003 to September 2020 – the main survey of individual economic activity in the UK which provides the official measure of the national unemployment rate.
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Grace Lordan, associate professor of behavioural science and director of TII, said: “A critic of our work will point to more women working part-time or choosing to stay at home with children.
"However, we draw the same conclusions if we document statistics related to full time, full year workers only. UK-born Black women are the most under-represented in the top percentile of incomes, as compared to all other women and men.”
The researchers also examined if the results could be explained by Black women working in occupations that lack progression opportunities, having more childcare responsibilities than other women, working fewer hours or lower levels of education.
Controlling for age, education, marital status, hours and occupation, there were still significant differences for Black women.
Researchers also found that Black women are less likely than any other group to be in the top 1% of income even when looking only at the black and minority ethnic workers population, where UK-born Black women are still 0.5% less likely to belong to the top 1%.
Researchers also examined how Black women compared with white women at different stages of their career. At early career stages, women from both groups are equally likely to be in the top 1% income bracket.
But 10 to 15 years later, in mid-career stages, gaps in earnings widen and the likelihood of a Black woman being a top earner is far lower than a White woman. For example, Black women are 6.1 percentage points less likely than White women to be in the top 10% of income.
Dame Minouche Shafik, director of LSE, said: "One of the most striking things for me about working in the financial sector for many years is that it draws on a very narrow talent pool of people from very similar backgrounds. This reduces innovation and risks groupthink."
Further research by The Inclusion Initiative, funded by Mastercard and sponsored by the 30% club, will identify actions to help companies address the issue.
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