Despite Drop in Black Unemployment, Significant Disparities Remain

In this Thursday, July 17, 2014 photo construction workers build a commercial complex in Springfield, Ill.

In this Thursday, July 17, 2014 photo construction workers build a commercial complex in Springfield, Ill. AP Photo

 

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Fourteen states had black unemployment rates above 6 percent at a time when the national unemployment rate was 4 percent in June, according to a new Economic Policy Institute report.

The African-American unemployment rate is at a record low, dipping below 6 percent in May for the first time since the federal government began tracking data by race in 1972.

The rate crept back up over the summer, but has remained relatively low—compared to historic numbers. In July, it was 6.6 percent. Still, the rate of black workers out of jobs is almost double that of white workers. The white unemployment rate in July was 3.4 percent.

And even with a strong job market, significant disparities remain across the country, with some states and the District of Columbia showing very different employment pictures when the race of workers is taken into account. The differences are most stark in Washington, D.C., where a new report by the Economic Policy Institute analyzing employment numbers from the second quarter of 2018 found that the unemployment rate for African Americans was 12.4 percent, while the white unemployment rate was 1.5 percent.

No states analyzed by the liberal-leaning EPI had rates of jobless black workers above 10 percent in the quarter, but some were still notably high. Illinois had a 9 percent rate, while New York and South Carolina were both at 8.1 percent. In comparison, the state rates of white unemployment were 3.4 percent in Illinois, 3.9 percent in New York and 2.3 percent in South Carolina.

Fourteen states had black unemployment rates above 6 percent at a time when the national unemployment rate was 4 percent in June. The EPI report found that Connecticut had the highest Hispanic unemployment rate at 8.2 percent, while West Virginia had the highest white unemployment rate at 5.1 percent.

(Like the rate for black Americans, the Hispanic unemployment rate has remained steadily higher than the white rate over the years. In July, it was 4.5 percent, according to the Bureau of Labor Statistics.)

“These data tell a familiar story. While the national unemployment rate was less than 4 percent throughout the second quarter of the year, unemployment rates for African American and Hispanic workers were, in some states, double that,” Janelle Jones, the EPI economic analyst who wrote the report, said in a news release. “It is crucial that policymakers work to drive the unemployment rate even lower if black and Hispanic workers in every state are going to share in our country’s economic prosperity.”

Discriminatory employment practices, insufficient investment in public schools and persistent housing segregation have all been cited by researchers as factors in the stubborn racial disparities with unemployment. In a piece for the Brookings Institution earlier this year, fellow Andre Perry noted that being able to get to work on good public transportation as an important consideration for low-income workers. Perry identified a number of majority black cities with high employment numbers where there was also high use of public transit.

In Illinois, think tanks on opposite sides of the political spectrum have suggested different approaches to tackling high unemployment in some African-American communities. The conservative Illinois Policy Institute in 2017, when that state had an even higher rate of black worker unemployment, wrote in a report that the state should reconsider its minimum wage hikes and offer more school choice. The group also advocated making changes to occupational licensing that make it easier for people with criminal records to get jobs in those fields, noting that black Illinois residents are disproportionately caught up in the criminal justice system. 

On the other hand, in a report that same year, the left-leaning Illinois Economic Policy Institute called on state and local governments to increase public jobs, ramp up financing of transit, enforce racial discrimination prohibitions, and reduce the local reliance on property taxes to pay for public schools.

“Effective policies that invest in workers, invest in public transit, bolster public sector employment, and lower the cost of homeownership can facilitate good, middle-class jobs for African Americans who face considerable structural barriers,” the report concluded.

The EPI report calculated state unemployment rates only if there are large enough sample size in federal government data. An interactive map with state statistics can be found here.

Laura Maggi is Managing Editor of Government Executive's Route Fifty and is based in Washington, D.C.

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