Why are British Indians more successful than Pakistanis?

Just under 60 per cent of British Pakistanis are living in relative poverty, while for Indians the figure is closer to 25 per cent. Indians are better represented in the top jobs than even the White British, while Pakistanis are significantly underrepresented. 12 per cent of doctors are Indian, while many Pakistanis are clustered in low-skilled professions; indeed, one study found as many as one quarter of Pakistani men drove taxis.

The divergence between the social mobility of the Indian and Pakistani communities in the UK is one of the most intriguing findings of the Demos Integration Hub, launched towards the end of May this year. It is a story that stands out again and again, across the majority of socio-economic and social measures. So how might we explain these differences?

The first thing to note is that while Indians are more integrated socially than Pakistanis, both are quite isolated. According to the index of dissimilarity, a standard measure of residential segregation, 63 per cent of Indians would need to move to another neighbourhood within England in order for there to be no segregation between them and all other ethnic groups. For the Pakistani community, this is even higher, at 76 per cent (a reading of 0.76 on the index). Furthermore, around 70 per cent of Pakistanis have friendship circles that are at least 50 per cent Pakistani, while for Indians the figure is smaller, but still substantial, at around 60 per cent.

When comparing Indians and Pakistanis in Britain, it is clear that both are somewhat cut off from other ethnic groups (although for Pakistanis the level of separation is greater) and yet they have wildly different levels of economic success. It cannot be that social and residential segregation are necessary, as well as sufficient causes.

We can think about the UK’s mainstream business culture and whether or not Indians have a culture that encourages economic success within this – Max Weber might ask if they were the new Protestants. However, we have what economists call the problem of endogeneity, whereby cause and effect are part of a mutually self-enforcing cycle. Put simply, you have a strong business ethic that leads to success in business, and that serves to further bolster that same business ethic so much so that it becomes very difficult to statistically determine what is cause, and what is effect. Certainly, it seems safe to say that with a little success will come a likelihood of further success, as money buys an education, and education is essential to being successful. In this respect, the success of Indians in the UK will only continue to compound itself.

There is also the question of immigration – in the post 1997 boom in immigration, the Pakistanis coming to the UK tended to have lower levels of education than Indian migrants, and people without an education will always struggle to get lucrative jobs. Also, Pakistani immigrants are coming from a poorer country than Indians, in terms of GDP per capita, so they will be starting out with less, which will reduce their access to opportunity.

So where migrants come from, and who they are, matters for their economic wellbeing – but so too does where they settle in their new country. For example, Pakistanis are much more concentrated in the North of England, which tends to have lower levels of prosperity and fewer high-paying or high-skilled job opportunities than the South, whereas Indians are much less concentrated in any one specific region.

Then there is the matter of culture and religion, and its role in segregation and social mobility, to consider. British Pakistanis are nearly all Muslim, while Indians are the most diverse of the major ethnic minority groups in the country. Generally, Muslims are poorer; Indian Muslims while better off than Pakistani Muslims, are much more likely to be in poverty than Indian Hindus and Sikhs. While employer and employee prejudice towards Muslims will certainly restrict opportunities, research by Anthony Heath et al shows that both Indian Muslims and Pakistani Muslims are much more likely to desire jobs that offer special provision for their religious practice at work, which in turn may further restrict the number of workplaces where they are prepared or able to find employment.

Another significant and related issue is the role of women in each community – and particularly their level of economic empowerment and participation. Pakistani women by and large do not work, while Indian women are much better integrated into the labour market. Also, Pakistanis have higher birth rates. So, if Pakistani families have only one breadwinner and more mouths to feed, then it stands to reason they will have a greater risk of poverty.

Overall, the explanations as to why the British Indian and Pakistani communities have experienced such differing levels of social and economic success in the UK are complex, and defy single variable solutions. What’s more, we must also remember that, despite their over-representation in top professions, many Indians – like other ethnic minorities – still face substantial ethnic penalties in the labour market, which will need to be addressed before true parity of economic opportunity with the White British can be declared.

To explore this issue, and other topics related to immigration, social cohesion and social mobility, please visit the Demos Integration Hub.