Are disability pay gaps misleading?

“I mentioned it once but I think I got away with it!”

Basil Fawlty didn’t get away with it in Torquay and neither did this manager.

HR Manager – “Our disability pay gap is zero which surprises me”

Me – “How many disabled employees do you have?”

My response sums up my view on Disability Pay Gap Reporting (DPGR). The manager commented on their pay gap whilst I queried their employment gap. As a statistician who happens to be disabled, I consider the conventional disability pay gap statistic to be at best irrelevant and at worse a lie.

Lies, Damned Lies & Statistics

When I say the difference between the hourly pay of the median (or average) disabled employee and the hourly pay of the median (or average) abled bodied employee could be a lie, I am invoking the sentiment expressed by Bill James, the father of Sabermetrics, the name given to the analysis of baseball statistics.

“The statistics were not merely inadequate: they lied. And the lies they told led the people that ran baseball to misjudge their players and mismanage their games”, The Bill James Baseball Abstract 1977

More than any other protected characteristic, the term Pay Gap has to be crushed into oblivion and replaced with the more accurate term Representation Gap when talking about disability. Once this change is made, then we can start to talk about DRGR (Disability Representation Gap Reporting) instead of DPGR. This article explains why and finishes by pointing out the government already has a reporting scheme in place that could become full fledged DRGR with a few tweaks.

The UK Disability Employment Gap

Unlike other blog posts I’ve written, this one combines my professional opinion as a statistician with my personal experience as a disabled person who had to overcome barriers in order to continue a career. The employment gap is very real to me and I want to digress briefly to talk about my disability before continuing.

My deafblindness

I have Usher Syndrome, a recessive genetic condition which combines deafness since birth and progressive blindness since adolescence. I was diagnosed with this in my late 20s, though I was aware of having issues before then. I was registered blind a few years later.

Specifically, I have Usher Type 2A which means my sight and hearing issues are –

Extreme tunnel vision. My field of vision is +/-2 degrees out of +/-90. Within this narrow field, my reading and distance vision are relatively normal provided light levels are good (note I say good, not OK since OK is bad for me).
Night blindness. I have no vision when light levels are poor by my standards.
I use a white symbol cane to get out and about. The cane protects somewhat against objects and people outside my field of vision. It also signifies to others that I am unlikely to see them coming.
Moderate hearing loss at low frequencies. Low frequency sounds can travel a long way.
Severe hearing loss at high frequencies. High frequencies only travel a short distance but are needed to discriminate specific sounds e.g. speech from background noise.
I’ve been using hearing aids since my hearing loss was diagnosed at age 6.
No balance issues. Such issues are common with Type 1 & 3 Usher but rare with Type 2.

Image from www.usher2020.com

I like to describe myself as partially deafblind. For more information about deafblindness in general, I recommend you start with SENSE‘s website. SENSE is a UK deafblind charity whom I’ve been involved with for over 25 years including being a trustee between 2000 & 2008.

My career as a deafblind statistician

From primary school, I knew some jobs such as a pilot were not an option for me. I was always good at maths and I never saw my hearing loss as a barrier to doing a maths-based job. I was a teenager in the early 80s when the 1st home computers came on the market (making me part of computing golden generation) and I took to coding straightaway. So by the time I graduated in the early 90s, I knew my hearing loss would create some issues but I didn’t see it as a serious impediment to having an analytical or computing career. I was aware of some issues with my sight but I didn’t see them as major issues and I was still driving.

That all changed within 5 years when I found out my sight issues were progressive, I was diagnosed with Ushers and I had to give up driving. I had every confidence I could adapt to keep working as a statistician but accessibility to & within my employer’s premises now became incredibly important to me. I was living in a rural area at the time but now I had to move to an urban area to access public transport and I also needed my employer to be accessible via public transport. This factor had two impacts, positive and negative, on my career over the next 5-10 years. The downside was my career progression ran into an unanticipated road block that I now realise was indirect disability discrimination. The upside was I became one of the pioneers of working at home which was very unusual for my employer at that time.

In 2006, I started my business delivering both statistical consultancy and training courses. My consultancy is usually done at home with odd meetings with clients but my training courses are in person (and now online following COVID19) where I have to lead and interact with many people whilst being deaf and blind. It might sound impossible, but the key point is I am the one in charge i.e. I am giving the presentation or running the training course. This means I have a large degree of control over my environment to make things as easy as possible for me and I have rarely had issues with my clients being unwilling to adapt to my needs. It’s when I am not in charge and I have to follow a large group who have made their own arrangements that I run into problems and difficulties and I can end up feeling or being excluded.

The UK Disability Employment Gap (resumed)

Not long after I was diagnosed with Ushers in the late 90s, a nurse suggested I contact SENSE. Deafblindness is so rare that most people do not have any experience of it so to make contact with people who knew exactly what I was going through was a revelation and so important to me. When we discussed my career, I was horrified to learn 70% of the people with Usher’s they knew were not in employment. I thought I had misheard and it was 17% but no it was 70%.

This was my introduction to the economic inactivity rate i.e. the percentage of a working age population (16-64) that are not in employment and are not seeking employment. Reasons for economic inactivity include homemaking, full time students, long term sick and early retirees. The UK Economically Inactive rate today is 21.4% which is higher than it was pre pandemic (20.5%) but still lower than it was 25 years ago (24%) when I contacted SENSE.

The Disability Employment Gap in the UK in 2019 was 28.6%. This is the difference between the economically inactive rate for disabled people (46.8%) and abled bodied people (18.2%). This is down from 34.2% in 2013 with most of the reduction due to a 45% increase in the number of disabled people in employment since then. This data comes the ONS (Office of National Statistics) who provide more detailed breakdowns by gender, type of disability and age.

The age effect is especially notable as shown in the chart. Economic inactivity is below 10% for able bodied between the ages of 25-54 whereas for disabled people it is 33% for ages 25-39 and rises to 40% between 40-54. The latter age range of 40-54 is probably when people move into higher paid senior roles but for disabled people it’s when they start to move out of employment.

Why am I not economically inactive today? By far and away the biggest reason is because I was extremely fortunate that my chosen career as a statistician was not affected by my disability in any material way. Give me a laptop, phone and a internet connection and I can work with almost any client anywhere in the world. What it affected was my ability to find and remain in work with a suitable employer and in 2006, I decided to start my own business instead coincidentally around the age of 40 which is the inflexion point of the chart above!

However, suppose I had been a bus driver, a surgeon or something else where good hearing and/or eyesight was essential? The changes in my life would have been profound and I have spoken with many people with Usher to whom this has happened. Typically this happens in people’s 30s or 40s and many end up economically inactive because the transition in their careers is too great to handle. Again this is reflected in the chart.

Pay Gaps & Employment Gaps are correlated

Recently, I showed highly male dominated (workforce is 90%+ men) private sector employers were much more likely to have gender pay gaps favourable to women than other employers. As the workforce becomes less male dominated, the pay gaps favouring men become much more common until women make up 20%+ of the workforce whereupon it flattens out.

Now substitute abled/disabled for men/women and it is my contention given the age range connection I made just now, that we will see exactly the same effect. Employers with very few disabled employees will see little or no disability pay gaps, those with many more disabled employees will see large pay gaps. In other words –

Employers with large disability employment gaps are likely to have small disability pay gaps
Employers with small disability employment gaps are likely to have large disability pay gaps

This is why I challenged the HR manager over their employment gap when he told me he was surprised their pay gap was so small. An employer who focuses on their disability pay gap is likely to misjudge their employment practices and draw the wrong conclusion. According to Bill James who I quoted earlier, that makes the mean or median disability pay gap statistic a lie.

I said earlier I was horrified to learn the economically inactivity rate for Ushers was so high. Given the likely correlation between employment gaps and pay gaps for disability, I have no hesitation in saying the disability employment (aka representation) gap is the key statistic and it is pointless mentioning your disability pay gap statistic to me.

Does that mean the standard gender pay gap statistic is also a lie. I have repeatedly pointed out flaws with this statistic and stated that pay quarter breakdowns are superior but do these flaws go as far as to make the median gender pay gap statistic a lie? The answer is no because UK workforce is 48% female and so highly male dominated employers are rare. Disability is a minority characteristic but is it a small or large minority of the UK workforce?. The smaller it is, the more likely the inverse correlation between employment gaps and pay gaps comes into play.

What is Disability?

At the end of 2019, 41.4mn people in the UK were in the 16-64 age range. Of these, 8mn were defined as disabled using the GSS (Government Statistical Service) harmonised definition of disability. When one considers only economically active adults in this age range, of which there were 32.3mn, 5.2mn (or 16%) were disabled. Therefore, disabled people are a small enough minority of the workforce such that the inverse correlation between employment gaps and pay gaps is likely to come into play.

I must confess 16% is higher than I expected but that is because the definition of disability is a very broad one based on the Equality Act 2010. Part 2, Chapter 1, Section 6.1 of the act states –

“A person P is disabled if –

1. P has a physical or mental impairment, and
2. the impairment has a substantial and long-term adverse effect on P’s ability to carry out normal day-to-day activities”

Section 6.6 gives the minister authority to refine this definition and the GSS currently state that “long-term” in the above is any physical or mental condition expected to last 12 months or more. So if someone is ill with Long COVID that restricts their ability to work and a doctor reckons they need at least a year to recover, they count as disabled.

Personally, I make a distinction between “classical” disability and long term health issues. I regard myself as being in good health, I just have a disability that places barriers in the way of my career and I don’t like people seeing me as unwell just because I have a disability. I will be writing an article at some point looking at what categories could be used for more detailed disability representation gap analysis since unlike ethnicity, there are no commonly agreed categories. The ONS does use some categories and these suggest what I would call classical disability accounts for about 33% of the 5.2mn economically active disabled population. About 25% have physical health issues and another 25% have mental health issues.

Having said all that, I have no problem whatsoever with the Equality Act definition when it comes to employment. This is because regardless of how one is disabled, the employer’s duty of care and requirement to make reasonable adjustments to working conditions will be the same. The distinction is still worth making in my opinion when analysing your data in more detail since people with disabilities are more likely to have started their career with a disability like I did whereas someone with a long term health condition are more likely to have acquired that later on in life after they have established their career. This difference could lead to different employment outcomes.

Pay Quarter Breakdowns are all you need

If the disability pay gap statistic is likely to be a lie due to the inverse correlation between the employment gap and the pay gap, what should employers use instead? The answer is one I have already recommended be placed front & centre for gender, with added bells for ethnicity and is the only option for disability. This is the Pay Quarter Breakdown (PQB) or fingerprint as I have sometimes called it. Once you have plotted your disability PQB, you can supplement this with disability swap numbers if desired.

What might disability PQBs look like? My suspicion is they will be similar to what we see at male dominated (80%+ employees are men) employers. If we substitute men for abled bodied and women for disabled, then these two examples could be what we will see for disability PQBs. I’ve chosen an employer from 2021 with 16% women (=disabled), which is the current share of the UK economically active population according to ONS, and another employer with 8% women i.e. half the UK share. Both employers are in the manufacturing/engineering sector with 250-499 employees.

The pay gaps shown are typical of employers with those gender balances. Both employers have similar upper pay halves but very different lower pay halves and demonstrate an inverse correlation between the pay gap and representation gap. Williams has twice as many women as Arconic but at Williams, the extra women are clustered in the lower pay halves. If these charts were of disabled & non-disabled instead, I would be questioning Arconic as why they have fewer disabled people just as I questioned that HR manager at the start of this article. In other words I would pay no attention to the disability pay gap statistic.

My views on government proposals

The government’s National Disability Strategy was published in June 2021. It covers many aspects of day to day life and the section on employment starts about half way down. The part of most interest to me is the section on Disability Workforce Reporting. This in turns refers to a Voluntary Reporting Framework (VRF) which is a requirement for an employer to receive Level 3 certification under a scheme called Disability Confident. The government’s strategy states they will consult employers on whether this reporting framework should become mandatory and what information should be disclosed.

What does the current VRF require? Here are the key features –

Aimed at employers with 250 or more employees.
Part A requires employers to publish a narrative on how they recruit, retain and support disabled employees.
Part B requires to report the percentage of employees who consider themselves to be disabled or have a long term physical or mental health condition.

For Part B, the VRF state the following which I copy and paste directly.

“consider whether the data is reliable enough to publish, including looking at non-disclosure rates
state the question used (if not the wording below)
explain the collection methodology”

By now you should have seen that if part B was expanded to also require a pay quarter breakdown by disability status, the VRF will end up more or less identical to my 7+5 recommendations to improve pay gap reporting! Those recommendations did focus on gender but I made it clear they could also be applied to ethnicity and disability subject to clarification over the categories to be used. I am currently talking with the government about adopting my recommendations for ethnicity reporting but I had not realised the government already had a reporting framework that more or less mirrored my recommendations.

Thus my view on the government proposal to consult on changes to the VRF is complete support. If the VRF is modified to require a PQB in addition to the current requirements, then a ready made framework for Disability Representation Gap Reporting will be in place as this article argues for. The other change I would make to the VRF is to require breakdowns by categories of disability. Unlike ethnicity, there are no ready made categories in everyday use at the moment and so thought needs to be given to what would be suitable. My next article on disability will look at the categorisation issue in more depth.

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