Income gap between black and white Bermudians widens

Black Bermudians with the same academic qualifications as their white counterparts are still earning significantly less, according to Census statistics.

Median annual income for black residents holding a bachelor’s degree was $80,640 in 2010 — compared with $105,753 for white residents.

With expatriates filtered out, the figures are less stark: $80,135 versus $95,436 respectively, reflecting the relatively high pay of predominantly white guest workers.

It’s a gap that appears to be growing when compared with the same figures from a decade earlier.

The 2000 Census shows the median annual incomes of black and white Bermudians holding a bachelor’s degree as $51,354 and $58,430 respectively.

That gap of 13.7 percent has widened to 18.75 percent a decade later.

For statistician and race campaigner Cordell Riley, the figures point to lingering and deeply-embedded inequalities scripted into the workplace.

Mr Riley pointed to the 2003 Adult Literacy and Life Skills study of residents which, when broken down by race, showed black and white Bermudians with fairly equal skill sets.

“If there’s no difference, why is it that one group is performing, in terms of income, so much better than another group?” he asked.

Noting the strong racial polarity between public and private schools, Mr Riley nonetheless downplayed their ultimate significance.

“Our public educational system is not as bad as we make it out to be,” he said.

“The Mincy Report found race contributed 29 percent to the disparity in income. Education only contributed 14 percent.”

Mr Riley acknowledged that most employers are “well-intentioned” and unable to see any preferential bent to their hiring and promotion when it comes to race.

He sees structural racism as the unseen hand which continues to benefit white workers over their black counterparts.

“There are things employers can do to make people feel welcome in their workplace,” he said. “They have to do more, because we will continue to get these kinds of results if we don’t make more of an effort.”

He added: “Let’s say I get a degree and come back to Bermuda with a qualification in computer science. It may not be from an Ivy League school, but it’s going to at least get me in the door. But if you have somebody who attended, say, the same high school as you, chances are you’re going to hire that person.”

Government’s report titled Education: Springboard to Employment and Higher Earnings, notes that whites earned 31 percent more than blacks in 2000, compared with 37 percent more in 2010.

“This is largely a result of a nine percentage point increase in earnings for white university degree holders over black university degree holders from 2000 to 2010,” the report notes.

For Mr Riley, who presides over the group Citizens Uprooting Racism in Bermuda, the Island missed an opportunity when the 2007 Workplace Equity Bill ended up falling from favour.

“Had it been implemented, we would now have five years’ history to see it working,” he said. “International business was initially on the side of it. They deal with that issue all over the world. It was nothing new to them. It didn’t have quotas and it didn’t bash employers over the head. It was extremely tame. But it didn’t get the support.”

Pointing to Bermuda’s long history of laws enacted in favour of whites, he added: “Legislation is what got us here. Ultimately, legislation could get us out of it. If not legislation, there has to be something else we can use to come to the same results. Because what we’re seeing here is a widening of the gap instead of a narrowing of the gap.”

The latest report highlights a sharp division in unemployment between blacks and whites who hold the same qualifications.

The rate is 8.7 percent for unqualified black workers, and three percent for whites.

For a black worker with a university degree it is two percent, versus 1.3 percent for whites.

At the high school certificate level, the unemployment rates for the two races are 4.8 percent and 2.5 respectively.

Mr Riley said he had been approached many times by black unemployed workers who saw themselves remaining out of work while their white counterparts seemed to get more easily steered into a job.

“They don’t speak out because they feel it might jeopardise their chances,” he said. “Is it actually true, and what’s behind it?

“What we’re all looking for is more equitable society. The challenge is how we get that — and what is equitable to whom.”

Asked what was fuelling the disparity, Bermuda College economist Craig Simmons said inequality arose from “differences in human capabilities, and a failure on the part of politicians to ensure a level playing field”.

Inequality in Bermuda appeared to be on the rise, he said.

“When looking at average inflation-adjusted income by sector between 1996 and 2006, one notes declines in sectors dominated by blue-collar workers,” he said.

“These include construction, wholesale and retail, hotels and restaurants, and transportation and communications. Conversely, over the same period, white-collar occupations — financial intermediation, business activities, and international business — had rising inflation-adjusted incomes. There is every reason to believe that this decade-long trend started before 1996, and continues to this day.”

Mr Simmons observed that Bermuda’s rapid growth as an offshore financial centre “dramatically increased the demand for talent, whilst the local supply remained relatively stagnant”.

He called rising inequality, in part, “the result of the supply of educated or skilled workers not keeping up with demand”.

“At least part of the increase in inequality stems from a simple theory: the powerful get what they want,” he said.

“This problem appears greatest among English-speaking countries. Since around 1980, incomes earned by the super-rich, the top one percent, have increased substantially. There is evidence to suggest that between 2009 and 2010, the US super-rich captured 93 percent of economic growth. It is the financial services industry that has captured the lion’s share of growth, not because it is more productive, but because it is politically connected.”

However, he added: “The lesson coming from behavioural economics is that the highly paid don’t perform better because of bonus pay.

“In fact, excessive pay has been shown to decrease performance at the executive and upper-management levels. Inequality, in many ways, is a political problem demanding political solutions.

“Growing inequality has yet to gain traction as an election issue. Perhaps it is because our very existence, as a low-tax, light-touch jurisdiction is at odds with our notion of fairness.”

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Published Oct 17, 2012 at 8:00 am (Updated Oct 16, 2012 at 11:19 pm)

Income gap between black and white Bermudians widens

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