People from certain ethnic minority groups have poorer outcomes in retirement than the average white person, and better personal finance data and evidence about the lives of the people in these groups is needed to inform policymaking to improve their outcomes, the Pensions Policy Institute (PPI) has said.

In a briefing note, the PPI found that while there was some overarching data across ethnic groups in national surveys, sample sizes are typically inadequate to understand the different factors that affect the outcomes of particular ethnic groups.

It called for better data coverage and evidence on the impact of intergenerational poverty and disadvantage, the impact of cultural, religious and family expectations, attitudes to caring and how retirement should be supported, data on household financial decision making, and how these factors differ between generations, age groups and whether people are first-, second-, or third-generation immigrants.

The PPI acknowledged that there were several surveys that ask questions similar to those necessary to investigate these areas, but some question modification would be needed to properly investigate cause and effect in the lives of people from ethnic minority groups.

Sample sizes would need to be boosted in most surveys, it stated, to enable breakdowns within ethnic groups by age, gender and income levels.

The institute also called for further research to be conducted into survey feasibility and design.

It found several possible reasons for poorer outcomes in retirement for ethnic minority groups, such as certain groups being more likely to be unemployed, some being more likely to be self-employed, some being more likely to work part-time, and the pay gap between certain groups and white people.

“Data gathering on people from ethnic minority groups is inadequate, especially in light of the poor average pension outcomes experienced by Black African/Caribbean, Pakistani, Bangladeshi and Chinese people,” commented PPI head of policy research, Daniela Silcock.

“These problems will affect more people in future as the proportion of ethnic minorities in the UK is expected to grow from around 15 per cent today to around 30 per cent by 2061.

“Strategic, tailored, policy-making and action by involved organisations (such as pension schemes), is required to reduce ethnic inequalities in retirement.

“However, there is insufficient data available on the experiences of all ethnic minority groups, to effectively inform policy and effect change.

“This briefing note is intended to start the discussion about how data gathering can be improved in order to provide evidence for future policy-making.

“If retirement outcomes are to be made more equal, it is critical that there is better evidence on the impact of discrimination, intergenerational disadvantage and the way that culture and religion shape the experiences and opportunities of people from ethnic minority groups.”

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