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Increasing Employment Rates for Ethnic Minorities

The NAO has reported today that, despite some progress, there is still a significant gap between the employment rate for the ethnic minority population and that for the general population which could take thirty years to eliminate. The Department for Work and Pensions’ strategy to tackle this has had some success, but in the NAO’s view has lacked continuity, adversely affecting efforts to reduce ethnic minority unemployment.

The employment rate for the ethnic minority population is 60 per cent, and 74 per cent for the general population.The Department has achieved its 2003 – 06 Public Service Agreement target to reduce the employment gap and is on course to meet its Spring 2008 target.

However, the gap costs the economy £8.6 billion each year and, although there have been significant fluctuations over the last 20 years, the gap is only 1.3 percentage points lower than it was in 1987. Reasons for the gap include that some ethnic minorities live in deprived areas with high unemployment; and some face discrimination and unequal treatment.

Most ethnic minorities who find employment through Jobcentre Plus do so through its mainstream services. But between 2002 and 2006, the Department introduced a number of programmes to tackle the ethnic minority unemployment gap, with varying levels of success. After spending £40 million and filling 15,500 jobs, these schemes have now been discontinued. The Department now focuses efforts on disadvantaged groups and deprived areas more generally, coupled with a move to more local decision making. This shift in focus carries opportunities to concentrate help on members of the community who are most disadvantaged, but carries the risk that ethnic minorities may not receive the help they need to gain employment.

The Department has now discontinued its programme to reach out to the ethnic minority community and help ethnic minorities who are not actively seeking work. Outreach activity by Jobcentre Plus is now discretionary, and in some offices is being significantly cut back. This risks losing the skills and experience of local voluntary sector organisations who specialise in this work, and their links to some isolated sections of the ethnic minority community. However, Jobcentre Plus advisers do an impressive job in helping ethnic minorities to find employment and a recent survey indicated few differences in the satisfaction levels between ethnic minority and white customers.

One consequence of lower employment rates for ethnic minorities is increased levels of poverty. nineteen per cent of the white population live in low income households compared with 56 per cent of the Pakistani and Bangladeshi population. And 23 per cent of white children live in low income households compared with 60 per cent of Pakistani and Bangladeshi children.

“Some progress has been made in tackling unemployment rates within ethnic minority groups, but the reality is that over recent years, while there has been a slow but steady improvement, the overall reduction in the employment gap has been modest.

“The Department for Work and Pension’s strategy has been fragmented but is being refocused on those living in deprived areas. While this provides opportunities to help those most disadvantaged, it carries the risk that some ethnic minorities may not receive the help they need to get a job. Unless the Department is prepared to do more to reach out to the ethnic minority communities, prospects for increasing their employment rate remain bleak”

The Comptroller and Auditor General

Notes for Editors

  1. The figures quoted in the NAO report and this Press Notice in relation to the employment gap are from the first quarter of 2007 – the latest available at the time of the study.
  2. Press notices and reports are available from the date of publication on the NAO website, which is at Hard copies can be obtained from The Stationery Office on 0845 702 3474.
  3. The Comptroller and Auditor General is the head of the National Audit Office which employs some 850 staff. He and the NAO are totally independent of Government. He certifies the accounts of all Government departments and a wide range of other public sector bodies; and he has statutory authority to report to Parliament on the economy, efficiency and effectiveness with which departments and other bodies have used their resources.

PN: 07/08