Summary Summary Background This report shows the findings from a field experiment that involved submitting matched job applications from white and ethnic minority applicants to estimate the extent of racial discrimination in different areas of the British labour market. The Department for Work and Pensions(DWP)commissioned the National Centre for Social Research(NatCen)to carry out the study to collect factual evidence to test the assertion that discrimination is a significant factor affecting labour market outcomes for members of ethnic minorities. That there are ethnic penalties in employment in Britain is a well-established fact. Among the studies that identify them is an authoritative study carried out for DWP by Professor Anthony Heath and Dr Sin Yi Cheung(2006).They describe poorer outcomes for ethnic minority groups in terms of rates of unemployment, the level of work attained and rates of pay.They demonstrate that these poorer outcomes remain even after controlling for differences in characteristics of the various ethnic groups,such as age profiles and levels of education.The size of the 'net ethnic penalties'identified was shown to vary across different ethnic groups as well as for men and women.Those ethnic minority members born and educated in Britain,so-called 'second generation migrants',experience ethnic penalties in a similar way to the first generation. Although studies of this type are strongly suggestive of the role of discrimination, there are other plausible factors that may contribute to the gap in labour market outcomes (for instance a lack of established contacts with potential employers among ethnic minority groups).In order to establish that discrimination is operating and to estimate the size of its contribution to ethnic penalties,different types of study that actually test recruitment procedures are needed.Summary 1 Summary Background This report shows the findings from a field experiment that involved submitting matched job applications from white and ethnic minority applicants to estimate the extent of racial discrimination in different areas of the British labour market. The Department for Work and Pensions (DWP) commissioned the National Centre for Social Research (NatCen) to carry out the study to collect factual evidence to test the assertion that discrimination is a significant factor affecting labour market outcomes for members of ethnic minorities. That there are ethnic penalties in employment in Britain is a well-established fact. Among the studies that identify them is an authoritative study carried out for DWP by Professor Anthony Heath and Dr Sin Yi Cheung (2006). They describe poorer outcomes for ethnic minority groups in terms of rates of unemployment, the level of work attained and rates of pay. They demonstrate that these poorer outcomes remain even after controlling for differences in characteristics of the various ethnic groups, such as age profiles and levels of education. The size of the ‘net ethnic penalties’ identified was shown to vary across different ethnic groups as well as for men and women. Those ethnic minority members born and educated in Britain, so-called ‘second generation migrants’, experience ethnic penalties in a similar way to the first generation. Although studies of this type are strongly suggestive of the role of discrimination, there are other plausible factors that may contribute to the gap in labour market outcomes (for instance a lack of established contacts with potential employers among ethnic minority groups). In order to establish that discrimination is operating and to estimate the size of its contribution to ethnic penalties, different types of study that actually test recruitment procedures are needed