Sewell report response: what does the data really tell us?

Here at the Joseph Rowntree Foundation, we openly recognise the culminative experience Black, Asian, and minority ethnic people face in this country, especially those locked in poverty. When the Government announced an inquiry into the disproportionate impact of COVID-19 on ethnic minority groups, as well as an investigation on institutional racism in the UK, we were eager for the findings. In our decades of work, we have written extensively on the intersection of poverty and ethnicity. As an organisation that wants to solve poverty in the UK, we openly recognise that the inequities between ethnic groups cannot be ignored and must be addressed if we are to truly solve poverty. The investigation should have been an excellent and in-depth discussion of the evidence and data on institutional racism, including poverty, labour market outcomes, housing, and social wellbeing. Thankfully, the report acknowledged labour market differences, but disappointingly it explained these away as individual choices based on historical experiences. That is simply not borne out by the data.

As a Senior Analyst, and having completed a PhD in Economics, I deal in evidence and data. JRF have conducted research on ethnicity and poverty and we think the evidence speaks for itself. Our data on employment by ethnicity is especially stark as there is a clear occupational segregation in the labour market. Nearly one in three Bangladeshi men work in catering, restaurants, and related businesses, compared to 1 in 100 White British men. Only 1 in 100 White British men work in taxi, chauffeuring, and related businesses, compared to one in seven Pakistani men. There is a substantial ethnicity pay gap; when comparing two graduate men, one Black and the other White, working in the same job in the same region with the same education, the Black male worker earns 17% less than the White male worker (Runnymede Trust, 2020). This substantial pay gap holds back Black, Asian, and minority ethnic workers from trying to progress and break free from poverty through good jobs (JRF, 2021).

The ethnicity pay gap is particularly large, and the wealth gap is increasing, as Pakistani households have around 50p for every £1 of White British wealth. Black Caribbean households hold around 20p for every £1 of White British wealth and sadly for Black African and Bangladeshi households, that figure is 10p (Runnymede Trust 2020). That lack of wealth and savings is an intergenerational problem. Due to the current labour market inequities BME households have fewer savings, meaning these households are less likely to pass on any wealth to younger generations. The lack of wealth and savings is also directly related to the ability to own a home, with Black households least likely to own their own home, and thus build up wealth. This is not aspiration or perception; this is lived experiences and current circumstances.

In the report the Government cited education statistics as perhaps why we should bring attention to the poor outcomes for white working-class men. It is simply not right that white working-class men have such poorer education outcomes, and this is something we should act on. Education should open doors, but it is important to widen the lens. While some black British have better education outcomes, this does not translate to better labour market outcomes. Again, this is not just one individual, but a majority. Pay and Curriculum Vitae (CV) studies, which are widely available, showcase the difference in experience in the labour market for BME workers, regardless of education. Multiple CV studies present evidence of discrimination in the labour market. For example, people with Asian or African-sounding surnames had to send in nearly twice as many CVs to get an interview (Wood et al, 2009, Di Stasio and Heath, 2019). This is systemic, as for some BME workers, just getting a foot in the door can be very difficult, regardless of educational attainment. If the person reviewing CVs is unwilling to interview people because of their surname, then how difficult is it for high achieving BME individuals to enter the labour market and progress. According to the report, and educational data, Bangladeshi students do well in schools, so why is it that British Bangladeshis continue to have high unemployment rates? Why is the wealth gap between British Bangladeshis and White British so large?

Many ethnic groups cannot just have their chances improved slightly by education; they are still held back from accessing similar jobs at similar pay levels as their White counterparts. Although legislation, such as the Race Relations Act in 1965,1968 and 1976, has had some effect in reducing discrimination, hereby lessening labour market inequities, these inequalities still exist as the BME employment gap is still similar to what it was in the 1980s. Just reviewing poverty figures shows that there is still a persistent problem for some ethnic minority groups. In 2017-20, poverty rates increased for children from Bangladeshi, other Asian, Black, and Other ethnic groups. These increases meant that over half of children in households headed by someone from Bangladeshi, Pakistani, other Asian, and Other ethnic groups were locked in poverty before the start of the pandemic. Over 40% of working-age adults from Bangladeshi and Pakistani ethnicities were trapped in poverty. Finally, this is a persistent and intergenerational problem as pensioner poverty rates for Pakistani pensioners are high, at 38% compared to White pensioners, of which 16% are locked in poverty.

Personally, as an African American woman, I needed some time to sit and reflect on what has happened over the last week. As this report was being released in the UK, in the United States we are in the middle of the Derek Chauvin court case, where a police officer is on trial after sitting on a black man’s neck for nine-and-a half minutes while the victim lay still. Those leading the UK report decided to make multiple statements denying institutional racism in the UK. It makes me angry to see them completely dismiss the valid concern and action by young people at this time as being influenced by Black Lives Matter in the United States, and therefore ignoring their anger towards the UK systems. It is important to recognise that this is not just a United States problem; the systemic and institutional problems infect the UK with devastating results.

Like other immigrants, I found myself being compared to Black British people as somehow being “better” than them or having more aspirations. This ignores the large volume of evidence behind why there is such a disparity between immigrants to the UK and people who are born British. It also ignores the deep levels of poverty and destitution in the communities of those who are not born in the UK, as well as research during the COVID-19 pandemic that showed Black migrants were more likely to be made redundant and less likely to be furloughed during the initial period of the pandemic in comparison to the rest of the UK. This is simply not right, and as a society we must do better. We can start by not only acknowledging systemic racism and its effect on those ethnic groups locked in poverty, but also by dismantling these systems with bold action.

We can do better and in fact, as a society, we need to do better. It is also imperative that the Government chooses to act. We cannot have another inquiry, another report on structural racism that acknowledges labour market inequities but does not believe it is due to institutional racism. We cannot be complacent or ignore these unequal outcomes. We have a multitude of evidence, including valuable lived experience work. What we need is to act now to prevent a further exacerbation of these inequities. As a society, we all need to play a part in reducing this injustice. We need a focus on good jobs and better labour market interactions for ethnic groups, more opportunities for BME households to gain stability and build intergenerational wealth through housing, and localised options to reduce the barriers that exist for some communities to access better jobs.