Women: Businesses — Motion to Take Note

Part of the debate – in the House of Lords at 4:40 pm on 21st January 2016.

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Photo of Baroness Falkner of Margravine Baroness Falkner of Margravine Chair, EU Financial Affairs Sub-Committee 4:40 pm, 21st January 2016

My Lords, I, too, thank the noble Baroness, Lady Wheatcroft, for securing this debate. Her speech was very much at one with her distinguished career as a journalist and in business, and was elegantly and forcefully presented to this House.

I am going to use my time today to speak about a subject that is not discussed very much but is critical to the long-term health of our economy: the contribution, or the lack of it, from ethnic minority women in the workforce. Those of us who have come from those backgrounds—there have been three of us as yet, with one to follow—know that there is a problem, but actually finding data on it, as I discovered when preparing this speech, is incredibly difficult.

A lot of work has rightly been done to highlight gender in business, on boards and in different professions, and to highlight the gender pay gap, the gender penalty and so on. But if you want to disaggregate the data into racial or religious subsets, there is very little material to work with. We are told that, on current trends, by 2050 one in five people in the UK will be from an ethnic minority background. No economy can afford a situation where one-fifth of its population is underemployed, underutilised and under-recognised.

In exploring the topic, I therefore decided to look at employment statistics overall. We know that the UK has been a success story in terms of having weathered the financial crisis and the ensuing recession without a dramatic fall in employment. This week’s figures show that the rate for 16 to 64 year-olds in employment is now 74%, but the rate for those from BAME backgrounds is 62%, reflecting a very clear ethnic penalty.

Different minority groups have different outcomes, however. In terms of professional advancement, Muslims seem to do proportionally worse. Research by the think tank Demos—I should declare that I am on its advisory board—shows that only 16% of Muslims occupy top professions, as opposed to 30% across the general population. Of those 16% in top professions, only 40% are women—or, to put it another way, roughly 6.4% of Muslim women are represented in top jobs. You would not have thought so, looking around this Chamber—but I do not think that we are representative of the population as a whole.

In another extensive study by the University of Manchester, which looked at social mobility based on the father’s profession, researchers found that while 46% of white women moved up to a higher socioeconomic class than their father, just 28% of first-generation Pakistani and Bangladeshi women moved up from their father’s socioeconomic class. Moreover, even in second-generation south Asian groups, men benefited from greater upward mobility than women. I should add that across the board in education, employment and professional advancement, black, Caribbean, Indian and Chinese people did better than Pakistanis and Bangladeshis—although Bangladeshis are catching up now, most notably in education. Looking more closely at this group, another study found that three-quarters of Pakistani and Bangladeshi women were economically inactive. Although those in the second generation were more likely to be in employment than those in the first generation, the rates are still far behind those of other minority groups.

This brings me to something more controversial: the reasons why certain religious groups seem to do less well than others. One reason is cultural norms, often driven by a misrepresentation of religious mores. It is not an accident that Muslim women are less economically active than Muslim men. A survey called Understanding Society showed that 44% of economically inactive Muslim women are inactive because they are looking after the home, as opposed to 6% of males. The national figure for those who gave this reason for not working was 16%. When asked why, 52% of the Muslim respondents said, “The family suffers if the mother works”. This was compared with just 34% of Christians and 23% of non-religious people.

Therefore, a male-dominated culture reflecting the perceived mores of the home country enforces the role of the woman as housebound, often in a multigenerational household where her place can be consigned to being the unpaid home help. I say “perceived mores”, as often the young women who might have been the product of an arranged marriage have come here from a country which itself has changed, but the community which they joined here in the UK does not seem to have kept up with those changes.

Disengagement from gainful employment means a lower family income, too. In the Manchester research, 57% of Pakistanis and 46% of Bangladeshis lived in poverty. Anecdotally, speaking to women from these groups I have seen their desire to improve their lot in life, but the barriers of language, education, culture and the lack of integration are too great for some to surmount.

What can be done? Talking about the first group—those in top jobs—at senior managerial and professional level, surely it is now time to amend the UK Corporate Governance Code. I look forward to the Minister being able to touch on that in her response. This currently says that boards need to pay heed to “diversity, including gender”, but I argue that it is now time to add the word “race” to those characteristics. UK plc can only benefit from becoming more inclusive. It may also be helpful for annual reports to break down the composition of managerial and senior staff into both gender and race categorisations. Where companies provide data, it is all too easy for them to hide behind apparent diversity while women and minorities occupy back-office and admin jobs.

At the more complex level of gender and integration, this will be a long haul, and a more vigorous approach to quantify the economic aspects of the problem is needed. This involves public expenditure on language classes, catch-up and ongoing training—but, above all, it requires shifts in mindset. It is mainly government which can drive change, and it is time it did so.