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The Role of the Workplace in Ethnic Wage Differentials

Author

Listed:
  • John Forth

    (Bayes Business School, City, University of London, UK)

  • Nikolaos Theodoropoulos

    (University of Cyprus)

  • Alex Bryson

    (University College London, UK)

Abstract
Using matched employer-employee data for Britain, we examine ethnic wage differentials among full-time employees. We find substantial ethnic segregation across workplaces: around three-fifths of workplaces in Britain employ no ethnic minority workers. However, this workplace segregation does not contribute to the aggregate wage gap between ethnic minorities and white employees. Instead, most of the ethnic wage gap exists between observationally equivalent co-workers. Lower pay satisfaction and higher levels of skill mismatch among ethnic minority workers are consistent with discrimination in wage-setting on the part of employers. The use of job evaluation schemes within the workplace is shown to be associated with a smaller ethnic wage gap.

Suggested Citation

  • John Forth & Nikolaos Theodoropoulos & Alex Bryson, 2021. "The Role of the Workplace in Ethnic Wage Differentials," DoQSS Working Papers 21-25, Quantitative Social Science - UCL Social Research Institute, University College London.
    • Handle: RePEc:qss:dqsswp:2125
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    Cited by:

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    2. Forth, John & Theodoropoulos, Nikolaos, 2022. "Earnings Discrimination in the Workplace," GLO Discussion Paper Series 1110, Global Labor Organization (GLO).
    3. Dave Maré, 2022. "Pay gaps – an $18 billion a year issue," Working Papers 22_45, Motu Economic and Public Policy Research.
    4. Phan, Van & Singleton, Carl & Bryson, Alex & Forth, John & Ritchie, Felix & Stokes, Lucy & Whittard, Damian, 2022. "Accounting for Firms in Ethnicity Wage Gaps throughout the Earnings Distribution," IZA Discussion Papers 15284, Institute of Labor Economics (IZA).
    5. Kaya, Ezgi, 2024. "Labour Market Performance of Immigrants: New Evidence from Linked Administrative Data," GLO Discussion Paper Series 1418, Global Labor Organization (GLO).
    6. Van Phan & Carl Singleton & Alex Bryson & John Forth & Felix Ritchie & Lucy Stokes & Damian Whittard, 2023. "Accounting for firms in gender-ethnicity wage gaps throughout the earnings distribution," Economics Discussion Papers em-dp2023-16, Department of Economics, University of Reading.

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    More about this item

    Keywords

    ethnic wage gap; workplace segregation; skill mismatch; pay satisfaction; job evaluation;
    All these keywords.

    JEL classification:

    • J16 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Gender; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
    • M54 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Labor Management

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