The measurement of discrimination in employment is a key variable in understanding dynamics in the nature of, and change in “race relations”. Measuring such discrimination using ‘situation’ and ‘correspondence’ tests was influenced by John Rex’s sociological analyses, and earlier work, begun in America, was continued in England in the 1960s, and further replicated in Europe and America in later decades. This literature is reviewed, and the methodologies of testing for employment discrimination are discussed. Recent work in Britain and the Netherlands is considered in detail in the light of changing social structures, and the rise of Islamophobia. Manchester, apparently the city manifesting the most discrimination in Britain, is considered for a special case study, with a focus on one individual, a Muslim woman seeking intermediate level accountancy employment. Her vita was matched with that of a manifestly indigenous, white Briton. Submitted vitas (to 1043 potential employers) indicated significant discrimination against the Muslim woman candidate. Results are discussed within the context of Manchester’s micro-sociology, and Muslim women’s employment progress in broader contexts. We conclude with the critical realist comment that the “hidden racism” of employment discrimination shows that modern societies continue, in several ways, to be institutionally racist, and the failure to reward legitimate aspirations of minorities may have the effect of pushing some ethnic minorities into a permanent precariat, with implications for social justice and social control in ways which may deny minority efforts to “integrate” in society’s employment systems.