17  All speeches are available online at www.bankofengland.co.uk/speeches  17  Chart 14: Median ethnicity pay gap by sector, sample average Ethnicity pay gap, per cent  London  20  Other 15  10  5  0  ‐5  ‐10  ‐15 Agriculture  Industry  Construction Trade and transport  ICT  Ethnic minority minority ethnic  Finance  Real Estate Professional Public sector  Other  White white  Source: ONS Labour Force Survey and Bank of England calculations. Note: A positive ethnicity pay gap in this chart indicates that ethnic minorities earn less than their white counterparts, whereas a negative ethnicity pay gap indicates that ethnic minorities earn more than their white counterparts. If we look at ethnic minority workers at a more granular level, some interesting cohort effects emerge. There is a very wide dispersion of pay among different ethnic minority cohorts, with some having negative and others positive pay gaps compared with their white counterparts (Chart 15). Median hourly pay is highest for those of Chinese ethnicity, at just over £ or around 15% higher than for whites. There are also negative pay gaps, though smaller ones, for workers from a mixed/multiple ethnic and Indian background. At the other end of the spectrum, there are significantly positive pay gaps for other ethnic minority cohorts, including black and Afro-Caribbean workers. The largest pay gaps are for workers from a Pakistani and Bangladeshi background, which average 13% and 20%, respectively (Chart 15).
By contrast, ethnic minorities born in the UK boosts earnings by around 7% relative to non-UK born ethnic minorities. UK-born ethnic minorities tend to be more educated and earn more across all the types of qualifications, compared with non-UK born ethnic minorities. (g)  London. Compared to the benchmark (the North), the region in which people live and work plays a  relatively very small role in determining their pay, with one exception – London and the South East. A job there boosts earnings, relative to the North, by 21% and 12% respectively. This effect is present across all four sub-groups. The ‘London effect’ is if anything more pronounced among white women, who earn 26% more. Section 5: Conclusion Let us conclude by summarising some of our main findings and then setting out some of the potential next steps, policy-wise, that flow from this analysis. 32  All speeches are available online at www.bankofengland.co.uk/speeches  32  First, the good news is that, once we control for various job and individual-specific factors, there is clear evidence of progress having been made in shrinking gender and ethnicity pay gaps in the UK over the past quarter-century or so. Based on the results from the Oaxaca-Blinder decomposition, these gaps have shrunk by around half for females, and by a little less than that for ethnic minorities. Second, the less good news is that these gender and ethnicity pay gaps remain large even once various compositional effects are taken into account, at around 10 percentage points.