Ethnic pay gap makes cost- of- living crisis harsher for minorities

Anusha Singh Tuesday 30th August 2022 09:28 EDT
 

The cost-of-living crisis has majorly affected the UK, but it is the BAME communities that have taken the harsher brunt of these difficult times. Recent research by a non-profit, People Like Us revealed that while the cost-of-living crisis affects everyone, the effects are not similar for everyone and the Ethnic Minority pay gap is to be blamed for it. According to the report, working professionals from diverse ethnic backgrounds are twice more likely to be denied a promised pay raise due to inflation, the proportion being 19 per cent as compared to the 10 per cent of white professionals. A much clearer picture is painted as 67 per cent (two-thirds) of racially diverse professionals feel that their white colleagues are doing the same job in a higher pay range.

Ethnicity pay gap is a complex problem

The minority pay gap issue is apparent across various fields and the NHS is no stranger to it. While it is facing a workforce crisis, the pay gap is another issue that needs to be tackled. 

According to Dr Indranil Chakravorty at BAPIO Institute for Health Research, “The ethnicity pay gap is a complex problem. The current NHS pay has remained well below inflation in the last decade accumulating a deficit of nearly 20-30% in real terms. Hence, it is not uncommon for many healthcare workers to seek financial or material help from charities and food banks.” “Disaggregated data shows that doctors from Chinese and Indian backgrounds earn more than their White peers. While for all other ethnic groups there is a significant ethnicity pay gap. The causes are complex and include legacy, socio-economic deprivation, schooling and university opportunities in addition to inherent biases at work”, he said. 

Similarly, according to the Race for Inclusion research report by the Law Society, not only do Black, Asian and minority ethnic solicitors earn less, but they also occupy fewer senior positions. This contributes to the ethnic pay gap of 25% when comparing hourly pay. 

Businesses are sadly, likely to struggle

The crisis will also affect overseas workers, Shoaib Khan, an immigration lawyer, explained. He said, “Although after Brexit it seemed it would be easier to sponsor foreign nationals to work in the UK and the government opened new routes, opportunities are likely to dry up with the cost-of-living crisis. Businesses are, sadly, likely to struggle, so there will be fewer vacancies. And as people close down businesses or lose jobs, there will be more local workers available. So, it is likely there will be fewer opportunities for overseas workers”, he said. His advice to the minorities is to become more confident in asking for equal pay. “It is shameful that even now people feel they receive lower salaries due to the colour of their skin. When vacancies are advertised, they should mention the salary offered, and employers must make an effort to eradicate disparity.”

The pay gap further widens for women of ethnic communities as the gender pay gap is added to the mix putting these women way behind white men, white women and ethnic minority men and at the bottom of the pyramid. 

Sunak needs to work with the community to hear the issues 

According to Dianne Grayson, founder of the ethnic Pay Gap Campaign, “Ethnic minorities must take action to ensure that their rights are being met.  It is not acceptable for organisations to pay ethnic minorities unfairly, nor is acceptable for organisations to block their path to promotion.” Talking about the effect of cost-of-living, she adds, “The cost-of-living crisis has only amplified the issue of unfair pay and data has already shown that there is a demonstrable squeeze on Ethnic minorities due to the barriers that exist.” She also feels that it is high time for the government to take responsibility, “The government needs to act urgently to make the Ethnicity Pay Gap mandatory to report.  They have dragged their heels for far too long on this issue and if Sunak gets the keys to number 10, I would expect him to make mandatory reporting an immediate agenda point for action.  Sunak needs to work with the community to hear the issues that have been obvious to many for years.  He needs to take action and have a concrete plan to make change ensuring to involve community leaders.”

Irreversible damage to pubs and brewing companies

In other “side effects” of the cost-of-living crisis, the 300% increase in the energy price puts pubs and brewers across the UK in danger of being forced out of business. The business operates without any price cap and pubs are struggling to find suppliers for their venues. Six major pubs and brewing companies in the UK have signed an open letter to the government, urging it to act to avoid irreversible damage to the sector. Additionally, according to a poll commissioned by the liberal democrats, one in ten Britons will take alone to cover the higher costs of gas and electric bills while 23 per cent would be forced to use credit cards to pay their bills. 

The tourists and the holidaymakers do not go spared from the crisis, even as they set out to relax. A study by No 1 Currency reveals that cutting back on meals out, room service and nights down the pub is the new holidaying scenario. While 28% of holidaymakers and tourists now set a daily spending limit, 18% are cutting back on alcohol to save money. 


comments powered by Disqus



to the free, weekly Asian Voice email newsletter