Unemployment rose three times faster for ethnic minority workers than white counterparts in the last year, analysis finds

Experts urge businesses to consider whether their culture and processes are barriers to employing BAME workers

The unemployment rate for ethnic minority workers has risen three times faster than the rate for white workers in the last year, research finds.

TUC analysis of ONS figures found that between April and June 2020 and the same period in 2021, the unemployment rate for ethnic minority workers rose 31 per cent, up from 6.1 per cent to 8 per cent.

However, the unemployment rate for white workers only increased by 11 per cent from 3.6 per to 4 per cent, meaning the growth of the rate of unemployment for ethnic minority people was almost three times faster.

The analysis also found that the number of people on zero-hours contracts fell slightly from 1.08 million between April and June 2020 to 917,000 between April and June 2021.

In its report, the organisation called for an extension to furlough and a ban on zero-hours contracts in response to the figures.

Frances O’Grady, the TUC’s general secretary, said it was “shocking” that there were still just under a million people on zero hours contracts. 

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“Many of these are the key workers who worked through Covid-19, but still face the uncertainty of not knowing when their next shift will be,” she explained, adding that “we know BME women are twice as likely to be on these low-paid, insecure contracts than white men”.

A previous report published by the TUC and ROTA in June had found that ethnic minority women were almost twice as likely to be on zero-hours contracts as white men. Research revealed that 4.5 per cent of women from an ethnic minority background were on such contracts, compared to just 2.5 per cent of white men.

O’Grady said that as the pandemic winds down, firms cannot allow inequalities in the jobs market to continue. 

“Ministers must take decisive action to hold down unemployment, create good new jobs and challenge the discrimination that holds BME workers back,” she suggested. 

Suki Sandhu OBE, founder and CEO of Audeliss, echoed the TUC’s calls to “abolish” zero-hours contracts and said the government needed to look to either extend current support measures or bring in targeted new ones.

“How are we ever going to reach the point of a closed pay gap and inclusive workplaces when such clear areas of inequality are left unchallenged?” he asked. “Part of building back better is to create a solid and fair foundation for the future of employment.” 

Pointing to the NHS Confederation’s report from December 2020, which found ethnic minority staff members were more likely to take on high-risk roles because of fear that contracts wouldn’t be renewed, Sandhu added that “not only does this report highlight a continued systemic problem when it comes to minorities in the workplace, it also shows that – when push comes to shove – diversity and inclusion efforts are the first to be shelved in times of crisis”. 

He said that companies must immediately review their I&D targets and be more ambitious to regain balance. “Those who don’t must be held accountable,” he advised. 

Zahra Mohamoud, race campaign manager at Business in the Community, told People Management that employers needed to actively consider how to attract and recruit more diverse candidates as they recovered from the pandemic. 

She asserted that ethnic minority workers were more likely to be in precarious work and were over-represented in industries that came to a halt as a result of the pandemic.

“When making redundancies, businesses should conduct equality impact assessments to ensure the process is fair, transparent and based on evidence,” Mohamoud said.

Bailey Bell, psychologist at Pearn Kandola, pointed out that there were similar trends in the jobs market during the 2008 financial crisis.

He added that organisations that are hiring should consider whether their culture or processes were presenting a barrier to employment of ethnic minority workers. 

“Things to consider include: the methods of outreach for new employees, the job requirements – is a degree necessary for the role or is this another unnecessary barrier for disadvantaged groups,” he said. 

Another thing for firms to consider internally was the support available for employees to keep them in work during a time where people may have picked up additional caring responsibilities and what development opportunities are distributed for those in insecure or temporary positions. 

HR professionals have a “key role to play” in rooting out inequalities and racism, explained Jon Boys, labour market economist at the CIPD, by helping to shape and set their organisation’s culture and people management practices. 

He said it is the role of HR to “review their organisation’s people management approach from end to end through multiple inclusion lenses, including race, to address blockers and biases in hiring, performance management, career progression and pay”.

Boys also said that the CIPD is calling on the government to make ethnicity pay reporting mandatory, rather than voluntary. “This will help employers to pinpoint where inequalities exist in their organisation so they can then take corrective action,” he explained.