British business isn't racist... is it?

Ethnic minorities are paid and employed less than white people with the same education. Is UK plc to blame?

by Adam Gale
Last Updated: 19 Aug 2016

When British business looks at itself in the mirror, it does not see a racist or a sexist for that matter.  Yes, the reflection may reveal a white (straight, Oxbridge-educated) man in his fifties, but that’s not because of racism. Is it?

There will be those who beg to differ, and they could easily arm themselves with a set of numbing statistics revealing deep inequalities in the UK labour market, courtesy of the Equality and Human Rights Commission (EHRC):

12.9% - unemployment rate for black Asian and minority ethnic (BAME) people, compared to 6.3% for white people.

23.1% - amount black graduates are paid less per hour than whites.

49% - increase in long-term unemployment for BAME 16-24 year olds since 2010, compared to a fall of 2% for whites of the same age.

6% - proportion of black school leavers attending a Russell Group university, compared to 11% for white school leavers (and 12% for Asians)

8.8% - of BAME people working as managers, senior officials or directors, compared to 10.7% for white people

5% - proportion of FTSE 100 directors who aren’t white, compared to 14% of the overall population.

It makes for grim reading. As British employers are the ones hiring, promoting and paying white and BAME people alike, it’s hard to avoid the conclusion that they are part of what EHRC chief David Isaac describes as the country’s ‘systemic unfairness and race inequality’.

Beware statistics

Well, yes and no. Obviously, British employers are a big part of a system that produces unequal results, but that does not mean they are racists.

Most people in business would be mortified at the accusation, and many businesses try very hard to attract BAME applicants and ensure fairness in their recruitment and promotion processes.

What they – and indeed all of us - are much more likely to suffer from is unconscious bias, which can significantly affect outcomes in recruitment and promotion. But unconscious bias alone will not explain the above statistics.

The missing ingredients are class and to a lesser extent age.

We are not as socially mobile in the UK as we like to think we are. If you’re born in the bottom quintile for household income, you’ve got a decent chance of staying there – and ethnic minorities are heavily over-represented in the bottom quintile.

It may well be that racism – conscious or unconscious – means BAME people from low-income backgrounds still have worse job and pay outcomes than white people from the same background, and/or are less socially mobile, but that doesn’t mean the significant role of class in race inequality can just be ignored.

Age, meanwhile, explains some of the under-representation on boards because directors tend to be older while the BAME population is younger (roughly 9% of over 55-65 year olds compared to over 25% of under 10s).

What this means is that the statistics paint a distorted picture (how distorted is debatable) of race inequality in the UK, that clears up somewhat upon closer examination.

The question is what to do with the information. It is absolutely not an excuse for UK plc to say ‘it’s not too bad really’, blame our class-ridden society and wash its hands of the inequality issue.

Instead, it’s an opportunity to think through why its diversity programmes haven’t achieved what perhaps it wanted them to achieve. It may be that a more structured effort to recruit people who don't tick all the usual boxes, with a stronger emphasis on attracting talent from less privileged backgrounds, might bear fruit in more ways than one.  

In any case, understanding a problem better can never hurt. Simply dismissing business as bigoted without trying to get to grips with the underlying causes of inequality, however, can.

Image credit: Image credit: Pui Shan Chan/Wikipedia


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