“Black workers with degrees earn a quarter less than white counterparts.”

That’s the headline from the TUC this week. The trade union organisation has published new research showing people from black, Asian and other ethnic minority backgrounds earn less than white people.

This “ethnic penalty” is there whether people are educated to GCSE, A level or degree level and is worse among people identified as black.

It sounds like a straightforward story of racial discrimination being alive and well in modern Britain. But the big picture is more complicated.

LONDON, ENGLAND - FEBRUARY 17: In this photo illustration notes and coins are displayed with a pay slip on February 17, 2010 in London, England. As the UK gears up for one of the most hotly contested general elections in recent history it is expected that the economy, immigration, the NHS and education are likely to form the basis of many of the debates. (Photo by Peter Macdiarmid/Getty Images)

The analysis

Here are the TUC’s figures, which come from the ONS Labour Force Survey:


This looks like damning stuff, but arguably it raises more questions than it answers.

First, the BAME category covers a wide range of different ethnic groups. Basically, it means everyone who doesn’t describe themselves as various kinds of white.

The TUC has also zoomed in on “black” people, which includes those who describe themselves as of African, Caribbean and Black British ethnicity.

Previous research suggests there might be some pretty big differences between, say, black and Asian people, as well as between different ethnic groups lumped together under the umbrella terms “Asian” and “black”.

But we don’t get that level of detail from this research. So when the TUC’s general secretary Frances O’Grady says: “Black and Asian people face a massive pay gap”, she could be right, but there’s no actual proof of an Asian pay gap presented here.

Which degree?

There’s also a bit of an “apples and oranges” issue: we don’t know if the people in the BAME group got the same grades at A-level, or the same class of degree as the whites – something that appears to make a big difference to future earnings.

Recent research from the Institute for Fiscal Studies has confirmed that people from all ethnic minorities are now more likely to go to university than white Britons.

But there is also some evidence that people from some ethnic minority backgrounds are likely to go to less prestigious universities and get lower grades on average than their white British counterparts.

Getting the right kind of degree can make a huge difference to your earning power. Professor Malcolm Brynin from Essex University told us: “The returns to a degree are so varied that for a significant proportion, they could be lower than the returns to an A-level.”

This research from the Runnymede Trust tries to compare like with like by focussing on students from the elite Russell Group universities.

The headline is that, yes, there are still gaps between white and ethnic minority graduates, who are less likely to be in employment six months after finishing their studies than similarly well-educated whites.

But the detail is interesting. The difference in employment is not because ethnic minority students are finding it significantly harder to get top jobs but that they tend to have “lower levels of non-professional employment, which is below their skills (but employment nonetheless)”.

What about graduates who do find work within six months?

“There do not appear to be consistent inequalities in relation to obtaining graduate-level work and in  earnings. In fact, ethnic minority graduates (particularly Indian, Black African and Other) seem to do better than their white peers when it comes to earnings.”

Similar research from the University of Essex also finds that non-white students are less likely to be in work six months after graduating, and those who struggle to land their first job are less likely to be working three-and-a-half years after graduation.

But again, there is less evidence of a purely racial pay gap.

The researchers found that differences in earnings could mostly be explained by differences in qualifications and socioeconomic background, although they do find signs that “ethnic minority graduates experience less career progression than their white British peers”.

Is racism to blame for the difference in earnings?

That is certainly what the TUC thinks.

“The harsh reality is that at any level of education, black and Asian workers are getting paid less than their white counterparts. Even today race still plays a huge role in determining pay,” says Frances O’Grady.

But that is a big call to make when we are not necessarily comparing people with the same educational achievements, and when “black and Asian” covers so many different ethnic groups.

While there is some evidence of disadvantage and unequal outcomes in education and work throughout this research, can we find hard evidence of institutional racism in data like this?

Professor Brynin said: “I think the short answer is no. It could be discrimination but you have no direct evidence of that.”