Informing Policies to Reduce Labour Market Inequalities
Submitting InstitutionSwansea University
Unit of AssessmentBusiness and Management Studies
Summary Impact TypePolitical
Research Subject Area(s)
Economics: Applied Economics, Econometrics
Summary of the impact
Research conducted by economists at Swansea University has revealed
deeply entrenched labour market inequalities. This research has directly
informed policy and related debates on a broad range of inequalities in
Wales and the UK, and skill mismatches in the EU. In particular, this
- has been used extensively by the Welsh Government to assess the
equality impact of the Welsh budget;
- is used by the majority of unitary authorities in Wales in developing
their equality priorities;
- has demonstrated international reach through informing policy debates
in Australia and the European Union.
The underpinning research has been enabled by the unit's established
strengths in labour market inequalities, dating back to an ESRC-funded
project on racial disadvantage in the mid-1990s. Five of the project's six
team members have worked in Swansea since 1993, with Prof Blackaby,
Prof Murphy and Dr O'Leary employed throughout the period. Prof
Leslie returned to Swansea in 2007 and has been Emeritus Professor
since retirement. This project produced arguably the most comprehensive
investigation of ethnic differences across a range of labour market
outcomes undertaken in the UK up until that point [R1]. The research was
based on analysis of several large-scale, secondary datasets and covered
standard outcomes (e.g. unemployment and earnings [R2]) alongside the
effects that discrimination in the paid labour market can have on other
outcomes (e.g. entry into self-employment and participation in
post-compulsory education). A particular focus of the research was on the
diversity of labour market experiences across ethnic groups.
The project team was commissioned by the Department for Education and
Employment to examine earnings and employment differentials for people
with disabilities in the late 1990s. This marked the beginning of research
by Swansea economists into this particular labour market inequality,
advanced considerably with the arrival of Prof Sloane (2002-date),
and the involvement of Dr Jones (2002-date) and Prof Latreille
(1991-2012). As with research on ethnicity, policy-relevant studies based
on the application of advanced micro-econometric techniques to a range of
different datasets have ensued [R3].
Analysis of the gender pay gap has taken place over the period and has
been published in leading academic journals [R4], as well as in
research reports. Dr Arabsheibani (2005-date) was part of a team
commissioned by the National Equality Panel (NEP) to undertake research on
pay differentials according to sexual orientation and some of these
findings are cited in the NEP's highly influential final report. Research
by Swansea economists has also increasingly established the potential for
education to reduce inequalities but that the benefits of acquiring
education are not the same for all groups [R5]. Research undertaken by O'Leary
and Sloane, funded by CEDEFOP (The European Centre for the
Development of Vocational Training), examined skill mismatch across the
European Union (EU) and in Australia, leading to the publication of four
These underpinning research strengths provided were integral to the
production of a report [R6] for the Equality and Human Rights Commission
(EHRC) in 2011 by the Welsh Institute of Social and Economic Research Data
and Methods (WISERD). Two of the four main chapters were largely written
by Swansea economists: Dr Drinkwater (2009-date), Jones, Dr
Parhi (2009-date) and Dr Robinson (2009-date), who also made
significant contributions to other parts of the report, particularly in
relation to data management and analysis.
The report presented a comprehensive and robust study of poverty and
inequality in Wales, using large-scale surveys to quantify different
inequalities across Wales, in relation to other parts of the UK, and to
the UK as a whole. This was the first time that such an approach had been
used to generate a report of this detail. Key findings included:
- the gap between rich and poor in Wales is actually narrower than in
the rest of the UK but only because of a relative lack of high earners
- gender, disability, ethnicity and religion make a major contribution
to educational and career achievements;
- pupils eligible for free school meals are 2.5 times less likely to get
A*-C grades in core GCSE subjects;
- 74% of disabled people are not in employment or full-time education.
References to the research
R1. D. Leslie, D. Blackaby, K. Clark, S.
Drinkwater, P. Murphy and N. O'Leary
(1998), An Investigation of Racial Disadvantage, Manchester
University Press, Manchester. (refereed monograph)
R2. D. Blackaby, D. Leslie, P.
Murphy and N. O'Leary (2002), "White/Ethnic
Minority Earnings and Employment Differentials in Britain: Evidence from
the LFS", Oxford Economic Papers, Vol. 54, pp. 270-297. (Refereed
journal article: rated as a 3* journal on the Association of Business
Schools (ABS) Journal Quality List)
R3. M. Jones, P. Latreille and P.
Sloane (2006), "Disability, Gender and the British Labour
Market", Oxford Economic Papers, Vol. 58, pp. 407-459 (refereed
journal article: 3* on ABS list).
R4. D. Blackaby, A. Booth and J. Frank (2005)
"Outside Offers and the Gender Pay Gap: Empirical Evidence from the UK
Academic Labour Market", The Economic Journal, Vol. 115, 2005, pp.
F81-F107 (refereed journal article: 4* on ABS list).
R6. R. Davies, S. Drinkwater, C. Joll, M.
Jones, H. Lloyd-Williams, G. Makepeace, M. Parhi,
A. Parken, C. Robinson, C. Taylor and V. Wass (2011), An
Anatomy of Economic Inequality in Wales, Report prepared on behalf
of the Wales Equality and Human Rights Commission, 2011.
Authors in bold and italics were at Swansea University at the time of
publication; authors in bold were at Swansea University before and after
this point but not at the time of publication.
Sloane and O'Leary formed a research team,
with colleagues in Dublin and Adelaide, that was awarded a research
contract by CEDEFOP worth in excess of £250,000 (2008-2012) to examine The
Determinants and Consequences of Skill Mismatch and Policy Implications.
Jones, Latreille and Sloane
were partners on the Health at Work project (2008-12), which was
coordinated by the University of Aberdeen and received in excess of €1
million in funding from the European Commission 7th Framework
Drinkwater is a team leader on a €2.3million NORFACE award
(2009-13) entitled Temporary Migration, Integration and the Role of
Policies (TEMPO), with the Swansea team focusing on Polish migrant
workers in the UK. (NORFACE is the New Opportunities for Research Funding
Co-operation Agency in Europe, a network of 15 national research funding
organisations in Europe and Canada)
In addition to the above projects, and the ESRC-funded project on ethnic
disadvantage in the UK labour market, funded research has been undertaken
on gender pay inequality and occupational segregation for the Equal
Opportunities Commission and the Welsh Development Agency and on
disability and the labour market for the Department for Work and Pensions
(DWP) and Welsh Government (WG).
Details of the impact
The underpinning research has demonstrable policy-relevance and impact
across several dimensions of inequality, including gender, age, ethnicity,
religion, sexual orientation and disability. This research therefore
covers the main groups that have been identified in the Equality Act 2010
as a protected characteristic.
The report produced by WISERD for the EHRC brought together various
dimensions of inequality and provided a similar but updated report for
Wales to that produced for the UK by the NEP. Not only did the WISERD
report contain information on a range of economic inequalities in Wales,
it also undertook far more detailed comparisons at a sub-UK level than in
the NEP's report. The WISERD report has been discussed on several
occasions in the National Assembly for Wales' Communities, Equalities and
Local Government Committee, with the Welsh Minister for Finance describing
the report, in October 2011, as "an important piece of research"
and commenting in October 2012 that it "had been used a lot
"in the joint WG and EHRC equality impact assessment of the
devolved budget for Wales [C1]. Moreover, the report played a valuable
role in providing evidence on which the WG based its financial
decisions. The EHRC's Commissioner for Wales described the report in
an article in the Western Mail as "groundbreaking".
Some of the findings from the WISERD report, especially from the chapter
on educational inequalities written by Drinkwater and Parhi, with Taylor
(Cardiff), were also discussed at the National Assembly for Wales and led
to an amendment to a motion in February 2012. This amendment highlighted
the report's contribution and quoted statistics on educational
inequalities from the report, with reference to the Pupil Deprivation
Grant [C2]. This scheme was subsequently introduced across Wales in
2012, with the aim of improving the educational attainment of
children from the poorest backgrounds.
The report has also been cited by the majority of unitary authorities
in Wales (including Anglesey, Cardiff, Caerphilly, Carmarthenshire,
Conwy, Denbighshire, Gwynedd, Flintshire, Powys, Torfaen and Wrexham) in
connection with their equality promises made in the light of the 2010
Equality Act. For example, Torfaen Council used the report directly to
identify its equality priorities [C3]. The report was also cited in
the Higher Education Funding Council for Wales' Child Poverty Strategy,
published in March 2012 [C4], and used extensively in the Equal Pay Duty
Briefing Note produced by the NHS in Wales [C5].
Presentations were made by Drinkwater to WG policy makers in May
2011; to delegates (comprising mainly practitioners from the housing
sector) at the Shelter Cymru conference in Swansea in June 2011, and to
National Assembly members and officials in Cardiff Bay in October 2012.
The report has led to much debate in Wales, as well as featuring in the UK
media, and was the main news item on virtually all Welsh media outlets
when it was launched on May 12th 2011 [C6]. For example, BBC
Radio Wales' main morning news programme was based around the report,
commencing with an interview with Drinkwater.
The underpinning research has led to reports and articles in academic
journals which have influenced and shaped policy debate and
developments in Wales, the UK and the EU. This initially related to
the increased interest from policy-makers in the labour market performance
of ethnic minorities in the UK, with the recognition of the ethnic
diversity in labour market outcomes. For example, an important DWP report
from 2009 cites Blackaby et al. [R2] as well as
some of Drinkwater's research [C7]. Swansea economists have also
interacted with policy-makers through seminars organised by government
departments (especially the DWP and WG) as well as sitting on advisory
committees and by contributing to public debates on these important and
often controversial issues. Examples include Blackaby and Drinkwater
sitting on the Joseph Rowntree Foundation (JRF)'s Poverty and Ethnicity
Advisory Group for Wales and Blackaby on the Royal Economic Society's
Women's Committee during the review period. The JRF programme on Poverty
and Ethnicity in the UK highlights research co-authored by Drinkwater
as a key publication [C8].
The underpinning research has also yielded international reach,
informing policy debate in Europe and in Australia. The results of O'Leary
and Sloane's research have been presented at several European level
policy-focused workshops, including the Agora Conference on Addressing
Skill Mismatch on Matching Skills and Jobs in 2009 — which was attended by
leading EU policy makers. The first of four, CEDEFOP-funded reports
produced by O'Leary and Sloane on skill mismatch across
the European Union (EU) and in Australia, led to a CEDEFOP publication
largely based around research undertaken at Swansea, which has since been
translated into several languages [C9]. Research undertaken in Swansea was
also fundamental to a chapter on skill mismatch appearing in a major
European Commission publication in 2012 [C10].
Sources to corroborate the impact
[C1] Minutes of the National Assembly for Wales' Communities, Equality
and Local Government Committee (October 2011, pp. 5-6; October 2012, pp.
[C2] Amendment to motion at National Assembly for Wales: www.assemblywales.org/bus-home/bus-chamber-fourth-assembly-motions.htm?act=dis&id=230649&ds=3/2012
(This also contains a hyperlink to the full report). Details of the debate
that took place can be found at:http://www.senedd.assemblywales.org/ieDecisionDetails.aspx?ID=366
[C3] Torfaen Council's "Equality Promise":
(This also contains a hyperlink to the report)
[C4] HEFCW's Child Poverty Strategy 2012-13 to 2015-16 (p. 3):
[C5] NHS Wales `Equal Pay Duty' briefing note:
[C6] BBC News article on the WISERD report: http://www.bbc.co.uk/news/uk-wales-13371064
[C7] L. Platt (2009), Ethnicity and Child Poverty, Department of
Work and Pensions, Research Report No. 576: http://dera.ioe.ac.uk/11016/1/rrep576.pdf
[C8] JRF Poverty and Ethnicity programme: www.jrf.org.uk/work/workarea/poverty-and-ethnicity
[C9] CEDEFOP publication on the Skill-Matching Challenge: Analysing Skill
Mismatch and Policy Challenges: www.cedefop.europa.eu/EN/Files/3056_en.pdf
[C10] European Commission's Employment and Social Developments in Europe
2012 (Chapter 4):