Ethnic minority and migrant pay gaps over the life-cycle

Hall, Tessa, Manning, Alan ORCID: 0000-0002-7884-3580 and Rose, Rebecca (2024) Ethnic minority and migrant pay gaps over the life-cycle. Oxford Review of Economic Policy, 40 (3). 556 – 578. ISSN 0266-903X

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Abstract

It is well-known that ethnic minority and migrant workers have lower average pay than the White UK-born workforce. However, we know much less about how these gaps vary over the life-cycle because of data limitations. We use new data that combine a 1999–2018 panel from the Annual Survey of Hours and Earnings (ASHE) with individual characteristics from the 2011 Census in England and Wales. We investigate pay gaps on labour market entry and differences in pay growth. We find that differences in entry pay gaps are more important than differences in pay growth. The entry pay gaps are large, though vary across groups. The pay penalties on labour market entry can, to a considerable degree, be explained by over-representation in lower-paying firms and, within firms, in lower-paying occupations. For most groups, the pay gaps at entry seem to be largely preserved over the life-cycle, neither narrowing nor widening. For migrants, we find that the extra pay penalty is concentrated almost exclusively in those who arrived in the UK at later ages.

Item Type:	Article
Additional Information:	© 2024 The Author(s)
Divisions:	Centre for Economic Performance Economics
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences
JEL classification:	J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J31 - Wage Level and Structure; Wage Differentials by Skill, Training, Occupation, etc. J - Labor and Demographic Economics > J1 - Demographic Economics > J15 - Economics of Minorities and Races; Non-labor Discrimination J - Labor and Demographic Economics > J6 - Mobility, Unemployment, and Vacancies > J61 - Geographic Labor Mobility; Immigrant Workers J - Labor and Demographic Economics > J7 - Labor Discrimination > J71 - Discrimination
Date Deposited:	09 Aug 2024 09:03
Last Modified:	12 Dec 2024 04:24
URI:	http://eprints.lse.ac.uk/id/eprint/124515

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