Mon 05 Aug 2019

ONS publishes first official ethnicity pay gap statistics

The statistics show that employees of Chinese, Indian and Mixed or Multiple ethnicity had the highest median hourly pay.

The highest earners were employees from the Chinese ethnic group, earning 30.9% more than white British employees.  Indian and mixed or multiple ethnicity employees also had higher average earnings than white British employees.  At the other end of the scale, employees from the Bangladeshi ethnic group earned on average 20.2% less than white British employees.  However, the existing pay gap between white British and other ethnic groups is generally smaller for younger employees than it is for older employees. 

The statistics also provide information on pay differences between men and women within each ethnic group.  Women in the Bangladeshi ethnic group were the only females to earn more on average than men in the same ethnic group.  The smallest difference was for the Black/African/Caribbean/Black British ethnic group with men earning on average 3.3% more than women.  The two highest earning groups, Chinese and Indian, had the biggest differences with men earning 19.1% and 23.3% respectively more than women in the same ethnic group.  The statistics showed white British women earned on average 18.5% less than white British men.  

With the exception of the mixed or multiple ethnic group (although this was shown not to be statistically significant) all other groups have smaller pay gaps as compared to white British employees when they have been born in the UK rather than outside the UK.  This difference could be significant.  UK born Bangladeshi employees were shown to earn 8% less than white British employees, but those born outside the UK had a 26.8% gap. 

The UK Government has encouraged employers to voluntarily disclose their ethnicity pay gaps but very few have done so.  A study recently carried out by PwC, Taking the right approach to ethnicity pay gap reporting found that three quarters of organisations lack the data required to analyse their ethnicity pay gap, with 40% highlighting that concerns around GDPR and other legal restrictions had prevented them from collecting data.   However, a Government consultation on ethnicity pay gap reporting ran from late 2018 into 2019 and it seems inevitable that ethnicity pay gap reporting will be introduced in the near future.

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