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Asians more educated but earning less in New Zealand

18:15 18/8/2023
Saunoamaali’i Karanina Sumeo, Equal Employment Opportunities Commissioner at the Human Rights Commission , encourages Asians to speak up and fight for pay equity.

Saunoamaali'i Karanina Sumeo, equal employment opportunities commissioner at the Human Rights Commission. Photo: Supplied / Human Rights Commission

The Human Rights Commission is urging ethnic groups, including Asians, to be more aware of pay disparity and speak up whenever they encounter bias.

The government announced on 11 August that it would take action to close the pay gap for New Zealand women, requiring more than 900 entities with over 250 employees to report their gender pay gaps.

It has also vowed to examine whether ethnicity needs to be included in the reporting process before legislation is drafted.

Human Rights Commission (HRC) equal employment opportunities commissioner Saunoamaali'i Karanina Sumeo said New Zealand had yet to achieve pay equity despite introducing the Equal Pay Act in 1972.

The new measure was a positive step to address the gender pay gap but called for legal protections to be introduced governing ethnic pay equality, Sumeo said.

A Human Right Commission report shows that compared with Pākeha men, Asian men miss out 263,481 dollars for their lifetime and for Asian women, it is 422,096 dollars.

The government has vowed to close the pay gap for New Zealand women. Photo: Supplied / Human Rights Commission

An HRC report published last year showed Pākeha men were at the top of the income ladder.

Looking at people who were earning wages in 2021, for every dollar a Pākeha man made, Asian men earned just over 86 cents. Asian women, by comparison, earned 83 cents.

Māori men earned just under 86 cents, while Māori women and Pacific Island men earned 81 cents. Pacific Island women made the least (75 cents), while Pākeha women have the smallest gap at 89 cents.

Looking at full-time workers, Asian men earned $263,481 less than Pākeha men over a lifetime of 40 working years. Asian women earned $422,096 less over the same period.

Sumeo said the differences would have a huge impact on people's children and family.

She said research in May showed nearly two out of every three New Zealanders considered pay gaps to be a "significant" or "very significant" issue.

"A lot of differences can't be explained by things like education and occupational choices, so we know that definitely discrimination is in play in our workplaces. We don't want to take advantage of people who don't understand their rights," Sumeo said.

"If we don't recognise ethnicity, then the unconscious bias and disadvantages of our Asian and Pacific communities will continue to contribute to them losing the income they deserve.

"My message to the communities is to keep speaking up, keep calling for the ethnic pay gap to be recognised alongside the gender pay gap.

"This is a critical time. We've got an election year. Be visible, be proud. You're worthy of it and you have human rights that need to be upheld. This is our time to do that."

First Union organiser Sun Min Elle Park says Asians, especially Asian women, are often neglected in discussions around pay equity.

First Union organiser Sun-Min Elle Park. Photo: Supplied

'We're often forgotten'

First Union organiser Sun-Min Elle Park said the amount of earnings that Asian women missed out on over the course of their careers could be enough to buy a small apartment.

The South Korean native said she struggled to find a job after graduating with a master's degree and was eventually offered a job as a receptionist for $40,000 a year. However, her Pākeha boyfriend at the time, who also graduated with a master's degree, was offered $62,000 and had two pay raises in one year.

Park acknowledged the couple studied different subjects but found it hard to accept the imbalance.

An Asian name was enough to make employers biased, and when accent, gender and ethnicity all came into play, Asians are losing out on many opportunities, no matter if they were capable of doing a job or not, she said.

"It's really sad," Park said. "No matter how hard I try, because of the bias again Asian women, I will be worse off than my Pākeha peers."

Although Asian women ranked second worse on the income ladder, media seldom talked about them, she said.

"We're often forgotten, or they don't care, or they don't want to talk about it," she said. "Our issues are often ignored."

Stereotypes also played a part in people's awareness of the pay gaps faced by Asians, Park said, adding that not all Asians were from a wealthy family, including herself, whose single mum spent her whole life working in factories.

"Legislative changes such as pay equity or pay transparency will definitely help," she said.

Raising awareness about the ethnic pay gap would also help drive changes, she said.

'Systemic problem'

Sumeo said ethnic minorities, especially new migrants, should not blame themselves for pay inequity, adding that the government, businesses and individuals needed to work together to solve the problem.

It was not uncommon to see migrants feeling intimidated to ask for better pay because they were diffident in their language skills and local knowledge, but they should feel capable and confident if they've passed the recruitment process, she said.

"When you begin to internalise and blame yourself for the pay gap, this is a statement to say no," she said. "This is a systemic problem. This is beyond your control."

Migrants are important to New Zealand's growth, and they need to be supported to reduce language and cultural barriers instead of being punished, Sumeo said.

She said Asians were also more reluctant to report bullying and harassment at workplaces, adding that such behaviour would ultimately affect their performances in the long run and subsequently make pay rises and promotions more difficult to attain.

"We're calling on businesses to step up and we're calling on the government to put in place a pay transparency legislation, to take that onus off our vulnerable workers and put it on our businesses and governments to make sure the environment is safe and supportive for all our workers."

Measures recommended by Human Rights Commission include making the pay range clear on job advertisements, removing contract terms that instruct employees to refrain from discussing salaries and asking all companies to monitor their pay gaps.

Sumeo said the issue of equal pay was "not a political issue, but a human rights issue", and whichever party is next in power should take urgent action.

Left: Liangni Sally Liu, a senior lecturer at College of Humanities and Social Sciences at Massey University. Right: Gail Pacheco, a Professor of Economics and director of the NZ Work Research Institute at AUT.

Left: Liangni Sally Liu, a senior lecturer at Massey University's School of Humanities Media and Creative Communication. Right: Gail Pacheco, professor of economics and director of the NZ Work Research Institute at AUT. Photo: Supplied

More educated but earning less

AUT NZ Work Research Institute director and professor of economics Gail Pacheco was part of the HRC research.

The pay gap for Asian males relative to European males was 13.9 percent, while the gap for Asian females relative to European females was 8.19 percent, she said, adding that these pay gaps could not be explained.

"The standout result in our findings is that … despite having higher educational attainment levels on average, Asians are not receiving the return to that skill level at the same rate as their European counterparts," Pacheco said.

"While Asian pay gaps are smaller than Māori and Pacific pay gaps, they are still sizable, particularly given the higher level of educational attainment they have on average. Importantly, they are also the group with the largest proportion that is unexplained."

Massey University School of Humanities Media and Creative Communication senior lecturer Liangni Sally Liu was concerned about ethnic pay gaps.

"Inequity in pay and its related social injustice are two big challenges globally," Liu said. "New Zealand is no exception. As an OECD and a traditional immigrant-receiving country, New Zealand needs to try its best to improve the situation."

In addition to improving pay transparency at workplaces, closer scrutiny of the implementation of the employment law was also needed, Liu said.

"To mitigate the workforce exploitation towards new Asian immigrants, relevant government organisations need closely monitor workplaces and establish mechanism to support new Asian immigrants to find jobs."

Minister for Ethnic Communities and Associate Minister for Workplace Relations and Safety Priyanca Radhakrishnan acknowledged the pay gaps faced by women and some ethnicities, and said the government was committed to tackling the problem.

"There is no silver bullet to tackle pay gaps, and we will continue to take different steps to address it," Radhakrishnan said. "I encourage organisations to look into their gender and ethnic pay gaps, and we encourage leaders in the business community who are already doing great work in addressing their pay gaps to encourage others to do the same."

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