Workers from Black, Asian, mixed race and minority ethnic backgrounds have significantly higher concerns of being made redundant due to the cost-of-living crisis, feeding concerns about the ethnicity pay gap. 

This is according to a new report from People Like Us and Censuswide, which also found that the cost-of-living crisis threatens to widen ethnic disparities in the UK, with four in ten (41%) workers from Black, Asian, mixed race and minority ethnic backgrounds worried that they will lose their job in the wake of increased costs.

This is compared to 27 percent of those from a white British background.

Those from minority ethnic backgrounds are also more likely to feel government support will not see them through the next six months.

This is a rate 7 percent higher than their white counterparts (52% vs 45%).

This is causing them to dip into savings at a greater rate, with ethnic minority professionals’ savings declining 1.3x faster than their white colleagues (falling 16% vs. last year; compared to 13% for white professionals).

Over half of professionals from ethnic monitory backgrounds (56%) admit to feeling despair as a result of the rising cost of living, 8 percent higher than their white colleagues.

Bills, borrowing and cutting meals  

Concerningly, the report reveals that people of colour are finding it disproportionately more difficult to keep up with rising costs.

A staggering 30 percent of workers from diverse backgrounds are now borrowing money from friends and family, compared to 21 percent of white British, and on average borrowing £188, or 22 percent more (£1027 compared to £839).

Alarmingly, 33 percent of diverse professionals are almost twice as likely to need to move in with family due to rising costs, compared to 18 percent of white British.

The study also found that 39 percent of ethnic minority workers are now skipping meals to save money, compared to 29 percent of white British.

Also, 35 percent of professionals from racially diverse backgrounds are struggling to afford their commute, compared to 23 percent of white British, while 45 percent of ethnic minority professionals are now worried about their level of debt, compared to 39 percent white British.

A staggering 36 percent of workers from diverse backgrounds are also relying on credit cards to see them through month-to-month compared to 27 percent of white British.

Sheeraz Gulsher, co-founder of People Like Us commented on the ethnicity pay gap:

“We need to make businesses accountable for their pay disparities. Mandatory gender pay gap reporting has started to get the wheels in motion to begin to address the balance between men and women, and we are now calling for mandatory ethnicity pay gap reporting to do the same on the grounds of race.

“It’s a positive step forward to have our first Asian Prime Minister in place, but with that change comes an increasingly stark reality that the broader community aren’t afforded the same assurances in terms of being guaranteed equal pay in their roles. We want to urge the new Prime Minister to take the initiative and introduce ethnicity pay gap bill without delay.

“This will start to address a fundamental imbalance, tackle a critical policy issue and ensure career progression and ambition is truly accessible for ethnic minority workers working in every department of UK PLC.”

The stark ethnicity pay gap

People Like Us revealed in January that workers from Black, Asian, Mixed Race and minority ethnic backgrounds are paid 84 percent of what their white counterparts earn. It also found that two-thirds (67%) of racially diverse working professionals polled said they have had reason to believe that a white colleague doing the same job as them was on a higher salary.

A quarter (24%) said they suspected the disparity in pay was up to £5,000, meaning people of colour could be losing out on £255,000 of earnings in a working lifetime due to the stark racially ethnic pay gap*.

State of the government 

On the economy, only just over a quarter of UK workers surveyed (28%) felt the proposed tax cuts would benefit them. Rather than tax cuts for the richest in society, with equivalent cuts in public spending, more than two thirds of respondents (68%) felt that the government should provide more financial support for the cost of living crisis, with a similar amount (68%) feeling more needs to be invested in public services.

Almost two-thirds (65%) agree the price cap should be changed and made variable based on those who need the support more. More than half (57%) feel that, as it stands, the price cap unfairly benefits those on higher incomes.

More than half of workers (61%) feel that the government should go further than a windfall tax, and instead nationalise gas and electricity companies, as well as rail companies (57%).

Across the board, and even with this cost cutting, there has been a worrying drop in savings. Workers from an ethnic minority background saw their savings drop by approximately 16 percent in the last 12 months as they looked to cover growing costs (dropping from £6,739 to £5,654 on average). Those from a White British background decreased by about 13 percent in the same period (from £6,453 to £5,633).

To help alleviate the lack of pay equity in Britain’s workplaces, People Like Us is urging the government to introduce mandatory pay gap reporting by ethnicity as well as gender, backed by almost half (46%) of all workers surveyed – with just 16 percent opposing it.  

Dianne Greyson, founder of the #EthnicityPayGap Campaign commented:

“This report recognises that Black, Asian and other Ethnic groups are continuously penalised by societal structures. It also identifies the pressures of austerity which are very much entrenched thus causing a catastrophic existence for too many Black, Asian and other Ethnic groups.

“The Ethnicity Pay Gap cannot be allowed to continue. The government must listen and take action and work with organisations such as #EthnicityPayGap Campaign and People Like Us to deliver a clear and actionable strategy. We also believe that the government needs to incorporate an addendum to their strategy that includes evidence of a planned strategy to close the gap. I would encourage all businesses of all sizes to support this People Like Us petition and pass it on to anyone and everyone – together we can make a difference and right this outdated wrong.” 

 

 

 

 

Amelia Brand
Amelia Brand

Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.