It's the government's job to erase racial wage gaps Torsten Bell


Persistent living standards gaps between ethnic groups have received badly needed attention in recent years. Theresa May, when she was leading the government rather than attacking it, commissioned the Race Disparity Audit, reminding us that Pakistani, Bangladeshi and black workers earn Britain’s lowest wages. In 2018, workers of Pakistani and Bangladeshi heritage earned 16.9% and 20.2% respectively less than white British workers.

But doing something about pay gaps, not just reporting them, is government’s job. Two recent US studies show that policies can make a big difference, for good or ill. The first examines the decision to segregate the US civil service under President Wilson in 1913, revealing it drove up wage inequality for black civil servants by seven percentage points. State-driven discrimination saw more senior black civil servants shifted to lower-paid positions. The second study, focusing on the 1967 extension of the minimum wage, brings more positive news. It drove down racial pay gaps, with the impact on wages for black workers nearly double that for white employees. That’s a big deal, accounting for more than a fifth of the overall civil rights-era reduction in the racial pay gap.

There is welcome news in the UK, too, where minimum wage rises have benefited our lowest earners without costing jobs. Indeed the employment gap between BAME and white people fell by 21% between 2008 and 2018. So the bad news is we’ve got a long way to go to tackle discrimination and disadvantage. The good news? We can ensure that change is gonna come.

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Torsten Bell is chief executive of the Resolution Foundation. Read more at resolutionfoundation.org



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