Jobs Friday: The Racial Unemployment Gap : Planet Money The unemployment rate for black workers is roughly twice that of white workers - and has been for half a century. Today we discuss the reasons for the gap, and how to shrink it.
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Jobs Friday: The Racial Unemployment Gap

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Jobs Friday: The Racial Unemployment Gap

Jobs Friday: The Racial Unemployment Gap

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UNIDENTIFIED PERSON, BYLINE: NPR.

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CARDIFF GARCIA, HOST:

Hey, everyone. It's Cardiff and Stacey, and the day couldn't arrive fast enough because today...

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GARCIA: I didn't even get to finish saying it. Like...

STACEY VANEK SMITH, HOST:

(Laughter) It's Jobs Friday.

GARCIA: It is Jobs Friday. That's what the air horn signifies because Jobs Friday couldn't even wait to get here.

VANEK SMITH: It's a very special day. It comes only once a month.

GARCIA: That's right.

VANEK SMITH: And there is a lot to celebrate this month. In the month of January, the economy created an impressive 225,000 jobs, and the unemployment rate was 3.6%, which means that the unemployment rate stayed close to its lowest point in about 50 years.

GARCIA: Now on this show, we have cited this low unemployment rate before as a sign of a relatively healthy labor market. And when you break it down further, it's also true that the unemployment rate has come down in recent years for every group of workers. But that does not mean that the unemployment rate is the same for every group.

VANEK SMITH: Right. The Bureau of Labor Statistics breaks all these numbers down. It reports on the unemployment rates for different racial and ethnic groups. For white workers, for example, the unemployment rate is down close to 3%. But for black or African American workers, the story is really different. Their unemployment rate is still 6%, twice as high as the unemployment rate for white workers.

GARCIA: And this gap between black and white workers is known as the racial unemployment gap. And that is what today's show is all about. It is also the focus of ongoing research by Gbenga Ajilore, a senior economist at the Center for American Progress.

GBENGA AJILORE: One of the things that I find is that the black unemployment rate is twice the white unemployment rate. But the key is that gap has been consistent since January of 1972 when the Bureau of Labor Statistics started following it.

VANEK SMITH: Since 1972, almost five decades ago, that ratio of roughly 2 to 1 for black unemployment to white unemployment has held. In fact, for most of that time, the ratio has been higher than 2 to 1.

GARCIA: And this unemployment gap between white and black workers also exists when you focus just on workers with the same educational backgrounds or when you zoom in on the same age groups or other categories. For example, black women have a higher unemployment rate than white women. And black workers with a college education have a higher unemployment rate than white workers who also have a college degree.

VANEK SMITH: Gbenga argues that this gap is the result of what he calls structural racism. And he says it's really important to understand what the words structural means in this context.

AJILORE: So when we think white racism, we think about individual behavior, someone being racist toward someone else. Structural racism is that a system is created so that people of different demographic groups end up getting further behind in outcomes. So an example of that is the criminal justice system. So there's studies showing that a white person who gets arrested is less likely to be incarcerated than a black person. So once someone gets involved in the justice system, when they're incarcerated, once they come out, they are going to have lower outcomes than anybody else. If we have people who are more likely to be incarcerated, then that's going to create racial gaps in outcomes like employment. We think about education systems - schools that are in certain segregated areas are going to have worse outcomes, and then you create these racial gaps without individual behavior because the system is creating these gaps.

GARCIA: Gbenga highlights a few trends to show that structural racism is what's causing the unemployment gap and that it's not the result of something else. The most important trend is the sheer persistence of the gap itself through both good and bad economic times. This includes times when the labor market has been really strong or tight.

VANEK SMITH: Tight. So when economists say tight labor market, they are talking about a situation where the economy is so strong and so many people have jobs that businesses really have to work hard to find employees. This tends to make it harder for businesses to discriminate against groups of workers because they just need people to do the jobs - for example, black workers or people with disabilities.

GARCIA: And Gbenga says a tight labor market can have that effect. It's a great thing. And, in fact, participation in the labor force - and participation means either looking for work or finding work - has gone up faster for black workers than for white workers in recent years as the labor market has gotten tighter. And yet, the racial unemployment gap has stayed the same. And what that suggests is that even once black workers are in the labor force and looking for work, they still face systemic barriers to actually getting hired that white workers do not face.

AJILORE: And so one of the things that we know about with African Americans is that a lot of times, they are the first fired and then the last hired. A lot of research has shown that this is the case. In a lot of cases, it's actually the first fired that's more of a stronger effect, that when there's a downturn, African Americans are usually the ones that are fired first.

GARCIA: For example, during the deep recession that ended now more than 10 years ago, the black unemployment rate went up more than the white unemployment rate. And it took longer to start recovering than the white unemployment rate did.

VANEK SMITH: And a trend that big, Gbenga says, cannot be the result of individual or isolated cases of racism. It's happening on too big a scale across the whole economy. That's what he means by systemic or structural racism.

AJILORE: A simple way to put it is that it's racism without racists.

GARCIA: And obviously, Gbenga is not saying that there are no racists in the economy. What he's trying to say is that to shrink the racial unemployment gap, policies have to address the system that creates the gap in the first place. And as for what might work, Gbenga will share some of those ideas with us right after the break.

Gbenga Ajilore says that policies to close the racial unemployment gap between black and white workers can't just leave the burden for shrinking the gap on individual people or individual companies. They have to address systemic problems. Here's one example.

AJILORE: The biggest key is with mass incarceration. And so one of things that we know about is that there is huge racial disparities in the criminal justice system. And when people come out of the criminal justice system, they have a hard time of being able to join the labor market. So there's things that we have - we can focus on in terms of employers. I think about programs that hire formerly incarcerated individuals. They work there, and then now they get skills. And then they get to kind of - think about like a stamp of approval so that they become more employable because what you want is you want to put the onus on employers to say, oh, they use that as an excuse to say, well, we don't trust people who were formerly incarcerated. But if you're able to get rid of that bias, any program or policy to get rid of that bias is going to help close that gap.

VANEK SMITH: Another thing Gbenga recommends is to bolster the staff and funding of agencies that exist to enforce civil rights laws, and - which are empowered to investigate a business when a worker brings a claim of racial discrimination, agencies like the Equal Employment Opportunity Commission, the federal agency created in 1965 as part of the Civil Rights Act.

AJILORE: The EEOC is there to combat employment hiring discrimination. However, over the last 40 years, the EEOC has been systemically dismantled - lower staff, lower resources. And they are the groups - not just the federal EEOC, but state-level groups need to be able to enforce civil rights laws. So one of the things we have to do is enforce the existing laws and strengthen the laws and strengthen the agencies that enforce those laws.

VANEK SMITH: Another thing Gbenga says would make a difference - changes in the economics profession itself. He's an economist, and he notes that black economists are underrepresented in economics relative to the overall population. And, in fact, he thinks that is one of the reasons the racial unemployment gap hasn't gotten more attention even though it's been there and pretty much fixed for half a century.

AJILORE: It's one of the things that it's been 50 years that we've seen this unemployment rate gap, and economists should have been looking at this over the last time. But this is something that only recently that I've noticed when I've been focusing on it that people have talked about it, that it's made some of the newspapers, made some of the articles about Jobs Day. But not enough people talk about it, and I think that has to do with who are the people looking at the numbers, who are the economists there.

GARCIA: Gbenga himself tweets about the labor market every Jobs Friday @Gbenba_Ajilore. And, in fact, that's where we first came across his work. And as always, we'll have links that we referenced in today's episode at npr.org/money.

This episode was produced by Leena Sanzgiri and fact-checked by Brittany Cronin. Our editor is Paddy Hirsch, and THE INDICATOR is a production of NPR.

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