A study finds that households of Bangladeshi origin in the UK are now experiencing the quickest income growth this century, driven by increases in pay and employment rates.
The Resolution Foundation’s assessment of household incomes in the UK unveils that the disparities between different ethnic groups have become less pronounced over the past two decades, reports the Financial Times
The average Bangladeshi household experienced the most impressive growth in real term incomes, growing by 38% between 2001-2003 and 2014-2016. These figures stand against the real term growth of 13% of white British households.
Strong headline figures however mask the overall disparities. Indeed, typical Bangladeshi household incomes remain 35% lower than those of white British households, respectively.
This gulf in income inequality translates to the median Bangladeshi household earning £8,900 less than a white British household.
Adam Corlett, senior economic analyst at the Resolution Foundation, speaking to the BBC, underlined that the income gap between minority and white British households were “significant and persistent”.
However, the marked improvements in key indicators, namely employment gains seen among Bangladeshi, Pakistani and black men and women offered encouragement, Corlett added.
Non-white minority groups tend to be disadvantaged in the British labour market – Prime Minister Theresa May, and her predecessor David Cameron have sought to highlight this in recent years. Nonetheless, the foundation finds that gaps in terms of employment and wages have shrunk.
Employment rates among Bangladeshi women jumped by 18% between 2001-2003 and 2015-2017. Female employment figures among the communities remain low when compared with white women.
Employment rates among Bangladeshi men also saw rises over the same period, while the rate for white men was stable.
Typical weekly pay for Bangladeshi male employees rose 28% between 2001-2003 and 2015-2017, controlling for inflation. Meanwhile, men of other ethnicity saw weekly pay grow by only 1%.
Family size was found to impact household income. The gap in living standards was also found to be exacerbated by inequality in home ownership. 58% of white British families are homeowners where only one-quarter of minorities are so.
The report also offered a warning that welfare spending cuts of £14bn could hurt future economic prospects for minority groups. It also says: “Given that the impact on low to middle income families is set to be very negative, and that some minority ethnicities are disproportionately low income, young and with children, there is a danger of recent progress being undone."