More minority ethnic than white British workers paid below UK real living wage

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Minority ethnic workers in the UK are disproportionately paid below the “real living wage”, data shows, reigniting calls to offer support in the cost of living crisis.

A report by the Living Wage Foundation (LWF) says 33% of workers of Bangladeshi heritage, 29% of workers of Pakistani backgrounds and 25% of black workers earn below the real living wage, compared with 20% of white British workers.

A survey of 2,010 people found that more than half of minority ethnic workers (56%) say they have experienced some form of discrimination at work, more than a third (34%) have been passed up for promotion owing to their ethnicity, and almost a third (29%) have been refused a job because of their ethnicity.

The report also highlights a gender pay gap: in most ethnic groups, women are more likely than men to earn below the real living wage.

The “real living wage” set by the LWF is £9.90 an hour in much of the UK and £11.05 in London for all workers over the age of 18, compared with the government’s national living wage of £9.50 an hour for those aged 23 and over. It is independently calculated based on the cost of living, and is paid voluntarily by more than 10,000 businesses.

Katherine Chapman, the LWF director, said: “In a cost of living crisis that has yet to peak, this report makes clear that minority ethnic workers will be among those hit hardest by soaring costs as many are disproportionately employed in low-paid, insecure work. The cost of living crisis, like the pandemic, is exposing longstanding racial inequalities in the labour market.

“Addressing poverty is impossible without challenging structural racism too. Employers who commit to paying workers the real living wage are not only supporting their staff through a cost of living crisis, they take the first step on a much bigger journey: towards racial equality in the UK labour market.”

Concerns have been raised about the disproportionate impact of the cost of living crisis on ethnic minority Britons.

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Dr Halima Begum, the chief executive of the Runnymede Trust, said: “Even before this devastating cost of living crisis began to escalate, data showed that over half of minority ethnic children were already living in poverty in the UK. Without appropriate and urgent interventions, it is inevitable that this figure will rise massively across the board as the crisis bites deeper and more families are forced to make impossible decisions while being plunged yet further into poverty.

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“As we plunge deeper into a generation-defining economic crisis, the first, most obvious and urgent step in that journey is clearly the requirement to pay employees a fair living wage.”

The headline of this article was amended on 7 September 2022 because an earlier version referred to white workers, when it meant to refer to white British workers.