British Indians among highest income fifth of the population, new study reveals

• Aparna Sreevalsan
• 15 November, 2022

* A new review found a greater disparity between different ethnic minority groups regarding wages.
* Indian heritage men earned 13 per cent more than their White British counterparts.
* All of the major minority groups have higher university attendance rates than White students.

ONE in four people of Indian ethnicity is among the highest income fifth of the population – more than is the case for White British, revealed by the new Institute of Fiscal Studies (IFS) Deaton Review of Inequalities in the workplace.
Although persistent, racial disparities in salary vary greatly among ethnic groupings.
Indian men earned 13 per cent more than white British men. Less than one in 20 people of Pakistani or Bangladeshi origin are in this highest income quintile.
In 2019, Black Caribbean men’s median weekly wages were 13 per cent lower than those of White British males, with Pakistani and Bangladeshi pay being 22 per cent and 42 per cent lower, respectively.
The new review also shows ethnic minorities in the UK seeing sharp progress in education, but wages and wealth lag behind. However, big differences remain between ethnic minority groups.
This provides evidence to not generalise all ethnic minority groups together.
Compared to the White majority, the educational achievement for the majority of ethnic minority groups in the UK has significantly improved in recent decades with Black Caribbean individuals standing out as an obvious exception.
However, most of them make less money than their White counterparts and all earn less on average than expected, given their education, background, and occupation.
Between 1991 and 2011, the percentage of the population in England and Wales who did not identify as White more than doubled to 14 per cent.
Only two per cent of Black African homes were in the wealthiest fifth of UK households prior to the pandemic, whereas more than half were in the least wealthy fifth, according to the review, funded by the Nuffield Foundation.
Other major findings include:
* Employment rate differences between racial and ethnic groupings are substantially less pronounced than they once were.
* Most of the biggest minority ethnic groups in England have a comparable chance of earning high English and Mathematics GCSE scores to children who are White British.
* 15 years ago, Bangladeshi students had a 10 per cent worse chance than White British students of earning strong Mathematics and English GCSEs. Their likelihood of doing so has increased by five percentage points.
* Black Caribbean students have, if anything, fallen further behind whereas Black African and Pakistani students have also made significant progress in closing the gap with White students.
* All of the major minority groups have higher university attendance rates than White students.
* In comparison to White British students, Pakistani students were 19 percentage points more likely to attend higher education in 2019, Bangladeshi students were 27 percentage points more likely, and Black African students were 29 percentage points more probable.
Mark Franks from the Nuffield Foundation said: “There are large and persistent income and wealth gaps between different ethnic groups in the UK. Children from Bangladeshi, Pakistani and Black African, and Caribbean heritage, are significantly more likely to grow up living in poverty than the white majority.
“Financial stress from not having an adequate income or work, reverberates through family life, with a range of consequences, including poorer mental health outcomes.”
The IFS Deaton Review of Inequalities, funded by the Nuffield Foundation, provides a comprehensive assessment of ethnic inequalities in the UK. It aims to understand inequalities in living standards, health, political participation, and opportunity, not just between the rich and poor but by gender, ethnicity, geography, and education too.
The Nuffield Foundation is an independent foundation that was established in 1943 and aims to improve social well-being by funding research and innovation in education, justice, and welfare.