Black Men and the U.S. Economy: How the Economic Recovery Is Perpetuating Systemic Racism
In this article
In recent months, leading economists have touted that the labor market is recovering from the global pandemic and related recession, putting the United States on a path to reaching full employment. In December 2021, Federal Reserve Chair Jerome Powell stated: “The labor market by many measures is hotter than it ever was [before the pandemic].”1 In many regards, that is true: Unemployment is falling rapidly, dropping to 3.8 percent in February 2022, which, while still above the pre-pandemic rate of 3.5 percent,2 marks a historic and faster recovery than expected.3 Workers across all racial groups have experienced larger declines in their unemployment rate compared with the recovery after the Great Recession in 2008.4
Yet this economic recovery is revealing the impacts of continuing systemic racism, ageism, and ableism on the labor market. Specifically, many Black men—older and disabled Black men in particular—continue to experience persistent gaps in both employment and economic opportunity. An economy where Black men consistently experience significantly higher unemployment rates than white men cannot be considered as having reached full employment.5 Likewise, a recovery that does not reach everyone equitably does not bode well for the country’s long-term economic health and stability.
Many Black men … continue to experience persistent gaps in both employment and economic opportunity.
In order to address this systemic challenge, this issue brief 1) examines how Black men are excluded from the economy and wealth-building opportunities; 2) considers the intentional policy choices the United States has made to keep Black men outside the financial mainstream; and 3) highlights the promising, intersectional policy interventions that are available to increase the number of Black men in the labor force, create good jobs, address wage disparities, and close the racial wealth gap.
The COVID-19 recession has had severe impacts on Black men’s employment
The COVID-19 pandemic plunged the United States into a deep recession that affected workers and families across the country; however, the impacts of this recession have also revealed the harmful ramifications of long-standing systemic racism on the labor market.
During the height of the pandemic-induced recession in April 2020, the unemployment rate reached 14.7 percent, the highest rate observed since this data collection began in 1948.6 While the unemployment rate for white men during this period was high relative to pre-pandemic levels, at 12.3 percent in April 2020,7 Black men’s unemployment soared to a high of 16 percent in June 20208—a level that has never been reached by white men.9 Notably, during this time, Black men also experienced longer periods of unemployment than white men:10 In 2021, the typical duration of unemployment among Black men was 20.1 weeks, compared with 16.6 weeks among white men.11 By February 2022, white men’s unemployment had dropped all the way to 3 percent, while Black men’s unemployment hovered at more than twice that, at 6.4 percent. While the decline in Black men’s unemployment rate has been faster than that of the Great Recession, racial inequities persist.12
Fortunately, the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020 expanded the Pandemic Unemployment Assistance program13 to give part-time workers, independent contractors, and gig workers—all jobs in which Black workers are overrepresented—unemployment benefits for the first time.14 However, from April 2020 to June 2020, only 13 percent of jobless Black workers received these expanded unemployment benefits compared with 24 percent of jobless white workers.15 This disparity in access to benefits can be partially attributed to the federal policy decision to allow states to set their own eligibility requirements and benefit amounts. For example, states in the South—the U.S. region with the highest proportion of Black residents—offer, on average, the lowest unemployment insurance benefits of any region in the country. As a result, fewer eligible people of color have received those benefits. These state-level differences have exacerbated poverty and economic hardship for many Black people, resulting in poorer economic outcomes.16 Furthermore, when Black workers are employed in certain low-income jobs, in roles such as home health care aides, or part-time work, their unemployment benefits tend to be smaller, limiting their ability to remain financially stable during an economic crisis.17
There are far more Black men who are jobless than the already high unemployment figures would suggest, further contributing to greater poverty, reduced financial stability, and a lack of generational wealth in Black families and communities.
Looking solely at the unemployment rate, however, can underestimate the extent of joblessness among Black men. After factoring in the disproportionate number of Black men and youth who are in carceral settings that are not counted as unemployed and also unable to look for employment, the prime-age employment-to-population ratio gap between Black and white male workers is even higher.18 Simply put, there are far more Black men who are jobless than the already high unemployment figures would suggest,19 further contributing to greater poverty, reduced financial stability, and a lack of generational wealth in Black families and communities.
Older Black men and those with disabilities face some of the greatest barriers to economic security
Importantly, Black men are not a homogenous group, and their experiences differ by age and disability status, among other factors. Black men who are also members of other marginalized groups, such as disabled people or older adults, often experience intersecting and compounding forms of discrimination. Older Black men, for example, may experience ageism as well as racism and must deal with the compounding impacts of income and wealth gaps as they age. Indeed, while the increase in early retirements and the large declines in labor force participation among older people are well documented,20 such trends are not present among older Black men specifically. In fact, older Black men experienced large increases in labor force participation in 2021, largely because they tend to accumulate less retirement savings and wealth than white men, affecting their ability to retire early.21 (see Figure 1)
In 2021, the number of employed Black men with disabilities also increased significantly. (see Figure 2) This increase in both older Black men and Black men with disabilities in the labor force22 partially reflects a tight labor market, in which employers may be willing to look beyond whom they consider “traditional” candidates. However, it might also point to the higher prevalence of disability in the Black community due to COVID-19 and long COVID, which have had differing impacts by race.23
This increase in employment of Black men with disabilities can be considered a positive development if it is in line with their own employment goals; however, the higher rate of employment is a cause for concern if it has occurred due to a lack of financial security, if it is a consequence of the racial wealth gap, or if the types of jobs being attained are not good jobs with living wages, access to benefits, and the opportunity to save for the future. Nevertheless, employment gaps persist, as labor force participation rates among Black men with disabilities are continually lower than those of white men with disabilities—although the gap has slightly narrowed in 2021 compared with 2020. (see Figure 2)24
Read more on the disparate impacts of the COVID-19 pandemic:
New Poverty and Food Insecurity Data Illustrate Persistent Racial Inequities
It is important to note that the employment gap between Black men and white men has never closed. If it were to close, however, Black men would see significant employment and wealth gains. Indeed, if Black men had the same unemployment rate as white men in 2021, there would have been, on average, an estimated 406,270 more employed Black men in the economy every month.25 A significant increase in employed Black men would help more Black households reach financial stability, build wealth, and secure stable wages. Furthermore, closing the employment gap would allow Black communities to accumulate approximately an additional $33 billion annually, benefiting the broader economy and, more importantly, reducing economic inequities and increasing generational wealth for Black individuals and families.26
If Black men experienced the same unemployment rate as white men, on average, 406,270 additional Black men would have been employed each month in 2021.
Historic discrimination means that Black men have long been left out of the labor market and are overrepresented in low-wage jobs
Almost 250 years of slavery, followed by the failure of Reconstruction and a century of Jim Crow segregation, built the foundation of Black suppression and exploitation in the United States, intentionally depriving Black people of opportunities to build or pass on wealth. Additionally, policies in the 20th century—such as the exclusion of occupations traditionally held by Black men from New Deal programs, discriminatory implementation of the GI Bill, redlining, subprime loans, gerrymandering, and voter suppression—compounded the inequities experienced by Black individuals and families in employment, housing, voting, and more, further cementing economic disparities that persist to this day. Meanwhile, the overrepresentation of Black men, women, and youth in the criminal justice system has had a high cost on the economic mobility of Black families and communities across the country for decades. Finally, inequitable access to public services and supports has forced many Black communities into enduring cycles of generational poverty and deprivation.27
As a result of this historical discrimination, Black individuals are overrepresented in low-wage jobs and have been left behind in the labor market. The types of jobs typically worked by Black men have been affected by the COVID-19 recession, driving the disproportionate economic impact on Black workers. The most common occupations held by Black men are low-wage jobs compared with those held by white men. In addition, 19 percent of employed Black men work in just their top five most common occupations, while about 14 percent of employed white men work in their top five most common occupations. (see Figure 3) This kind of clustering in a small number of occupations means that when an economic shock hits, the groups who disproportionately work in the most affected occupations, such as Black men, bear the brunt of the shock, while groups that are more spread out among occupations, such as white men, are more protected from layoffs.
In 2021, more than 1 in 5 employed Black men worked in either leisure and hospitality or wholesale and retail trade28—jobs that are in person and on the front lines, exposing Black families to higher health risks during the COVID-19 pandemic. Moreover, the jobs held by Black men not only tend to pay less but also have limited or no benefits such as paid family and medical leave, retirement savings, and at-will scheduling. This lack of accommodations and benefits compounded the risks experienced by Black workers during the pandemic. Not surprisingly, people of color—and especially the Black community—have experienced a disproportionate burden of COVID-19 cases and deaths.29
In addition to Black men’s overrepresentation in low-wage jobs, data trends show that they tend to have some of the highest unemployment rates among all racial, ethnic, and gender groups; in other words, the racial differences in labor market outcomes experienced during the COVID-19 recession are not new.30 In fact, since the U.S. Bureau of Labor Statistics began collecting data on Black men’s unemployment rates in 1972, Black men have persistently experienced unemployment rates at twice the rates experienced by white men. (see Figure 4) Chronic unemployment experienced by Black men is also coupled with high levels of underemployment, where Black men are more frequently only able to find part-time jobs even when seeking full-time employment.31
Read more on the Black-white unemployment gap:
The Persistent Black-White Unemployment Gap Is Built Into the Labor Market
Policy has sustained long-term racial wealth gaps, preventing generational wealth accumulation
Enduring unemployment and underemployment for Black men are only one part of the story. A long history of racial discrimination and exploitation—through overrepresentation in the criminal justice system, unfair hiring and firing practices, and a lack of economic opportunity and wealth building—has left too many Black men and communities impoverished and less resilient to overcoming economic, health, and social disruptions.
Stark racial and ethnic differences that do not receive sufficient attention exist among wages for full-time, year-round male workers: In 2020, Black men earned just 75 cents for every $1 earned by white, non-Hispanic men.32 And prior to the pandemic, in 2019, the median income for Black households was $45,438, while the median income for white households was $76,057.33 Given that white households are more likely to have inheritances, higher home values, higher savings, and greater income growth through the stock market, they tend to have much higher wealth than Black households; for context, the median wealth for white households was $188,200 in 2019, almost eight times that of Black households, whose median wealth was $24,100.34 This trend of white household wealth dwarfing that of black households can be traced back 30 years.
As a result of the wealth gap, Black households faced more financial emergencies with fewer economic resources to weather them during the pandemic, which resulted in an even further widening gap in economic opportunity between Black and white households.35
In 2020, Black men earned just 75 cents for every $1 earned by white, non-Hispanic men.
Wealth allows individuals and families to endure economic shocks, access critical support during economic downturns or job loss, save up to purchase assets such as homes, invest in opportunities through higher education or start a business, and pass on wealth to children and grandchildren. In other words, these disparities matter and have profound consequences. According to the U.S. Census Bureau, in 2021, the homeownership rate for Black families was 43 percent, compared with 74 percent for white families.36 And recent research estimates that by 2064, a typical Black family will have accumulated approximately 70 percent less wealth than a typical white family. (see Figure 5) 37
Unemployment, underemployment, wage inequality, and discrimination in the labor force all factor into an individual or family’s ability to save and accumulate wealth throughout their lifetime. Moreover, Black men must overcome additional barriers to building wealth, such as higher mortality rates than their white counterparts—which prevents them from accumulating wealth to pass on to future generations—as well as discrimination and limited access to the health care system and health services.38 These barriers collectively hinder wealth accumulation for Black men, affecting their ability to pass on wealth to future generations.
Read more on the racial wealth gap before and during the pandemic:
Wealth Matters: The Black-White Wealth Gap Before and During the Pandemic
Policy interventions: Investing in Black men’s full participation in the economy and closing wealth gaps
While the recovery from the pandemic-induced recession has been good for many Americans, it has occurred against the backdrop of historical disparities among populations that existed long before the pandemic. A recovery that does not address the consequences of systemic racism and its impact on Black men’s employment cannot be considered as having achieved full employment in the United States. A truly equitable economy must deliberately center Black men, addressing the historical barriers to their full employment and participation in the labor market.
The federal government plays a crucial role in addressing economic inequities and bringing the economy out of recessions. Yet to do so equitably, the federal government—along with state and local governments, nonprofits, and the private sector—must also work to dismantle the historical racism, sexism, and ableism that has impeded economic security and mobility for far too many individuals and communities of color. On his first day of office in January 2021, President Joe Biden guided the United States toward securing a more equitable future by signing an executive order that centered the federal government’s role in advancing racial equity and support for underserved communities. This historic directive signaled the Biden administration’s intentions to dismantle deep-seated barriers to full economic participation and mobility, particularly for Black men and youth.
Read more on the Biden administration’s efforts to implement a racial equity agenda:
Advancing Equity: Review of the Biden Administration’s Efforts in Its First Year To Implement a Racial Equity Agenda
Coordinated efforts among the executive office, federal agencies, and state and local governments can leverage government investments to promote policies, programs, and practices that combat widespread and persistent racial wealth and employment inequities. To do so, policymakers need not reinvent the wheel; there is a plethora of intersectional policy interventions that can direct future actions to increase the number of Black men in the labor force, address wage disparities by raising the wages of Black men, and close the racial wealth gap by increasing Black men’s wealth.
Policy interventions that can help increase Black men’s labor participation and close the wealth gap
- Provide higher and living wages, especially in occupations and industries with lower wage floors, particularly those employing Black men.
- Provide access to unemployment insurance and other safety net programs during times of economic or personal crisis.
- Create more union jobs with benefits, consistent hours, and opportunities for promotions.
- Ensure that working families have access to universal preschool and affordable child care.
- Enforce anti-discrimination in hiring and firing decisions.
- Enforce second chance and ban the box hiring policies that prevent employers from asking justice-involved individuals to disclose their arrest and criminal conviction records as a condition for employment.
- Implement pay transparency measures for employers, collecting salary data by race and sex.
- Implement local hiring provisions in the Infrastructure Investment and Jobs Act.39
- Enforce participation goals for Black men on federal contracting projects through the Office of Federal Contract Compliance Programs.
- Create apprenticeship and pre-apprenticeship programs that target Black men for jobs in skilled trades.
- Ensure access to affordable job training programs and direct Black male job seekers to occupations that pay living wages and benefits through the public workforce development system.
- Eliminate Section 14(c) of the Fair Labor Standards Act and create a law for minimum wages in jails and prisons.
- Ensure that everyone, especially at-risk youth transitioning from foster care or carceral settings, has access to high school completion and/or GED and relevant wraparound services.
- Ensure that all Americans have access to quality higher education without exorbitant student debt.
- Enhance student debt relief for Black people.
- Provide access to banking and financial inclusion options through postal banking and community banking and to mainstream financial options.
- Promote equity in homeownership, mortgage lending, and property valuations.
- Boost funding for the Minority Business Development Agency.
- Ensure that small-business owners of color have access to capital.
- Invest in businesses in Black communities and neighborhoods and around historically Black colleges and universities.
- Redesign federal funding of research and development to target investments in Black inventors and innovators.
- Eliminate the asset limits on Supplemental Security Income, the Supplemental Nutrition Assistance Program, and other benefits while also making it easier to access safety net programs for single individuals without children.
- Improve voting protections and ensure that Black individuals and families have a voice in the electoral process.
Historical and current policy decisions have kept Black men out of the economic mainstream for far too long, resulting in poor health, social, and economic outcomes for many Black men and communities. The United States has a moral obligation to eliminate the barriers that have kept too many Black men from fully participating in the workforce and economy. For generations, these barriers have taken a devastating toll on Black families and communities, hindering their economic growth and prosperity.
A range of intersectional solutions and interventions can support the ongoing economic recovery and result in economic empowerment and prosperity that includes Black men and their families. All that is needed is the collective will of the U.S. policymakers to right these wrongs.
The authors would like to thank Christian Weller, Lily Roberts, Marina Zhavoronkova, and Anona Neal from the Inclusive Growth department, as well as Nicole Lee Ndumele and Mia Ives-Rublee from the Rights and Justice department, for their thoughtful guidance, review, and support.
- Courtenay Brown, “U.S. on the cusp of full employment,” Axios, December 15, 2021, available at https://www.axios.com/jerome-powell-full-employment-27be7355-6568-4419-9ec8-13d4d1f6e3a8.html.
- U.S. Bureau of Labor Statistics, “The Employment Situation—February 2022,” Press release, February 4, 2022 available at https://www.bls.gov/news.release/pdf/empsit.pdf.
- Seth Hanlon and others, “The Biden Boom: Economic Recovery in 2021,” Center for American Progress, January 19, 2022, available at https://www.americanprogress.org/article/the-biden-boom-economic-recovery-in-2021/.
- Algernon Austin and others, “Assessing the First Year of Biden, in Graphs” (Washington: Center for Economic and Policy Research, 2022), available at https://cepr.net/report/sotu-2022/.
- Olugbenga Ajilore, “The Persistent Black-White Employment Gap Is Built Into the Labor Market,” Center for American Progress, September 28, 2020, available at https://www.americanprogress.org/article/persistent-black-white-unemployment-gap-built-labor-market/; Olugbenga Ajilore, “On The Persistence of the Black-White Employment Gap” (Washington: Center for American Progress, 2020), available at https://www.americanprogress.org/article/persistence-black-white-unemployment-gap/.
- U.S. Bureau of Labor Statistics, “Labor Force Statistics from the Current Population Survey, Unemployment Rate,” available at https://data.bls.gov/timeseries/LNS14000000 (last accessed February 2022); Congressional Research Service, “Unemployment Rates During the COVID-19 Pandemic” (Washington: 2021), available at https://sgp.fas.org/crs/misc/R46554.pdf.
- U.S. Bureau of Labor Statistics, “Labor Force Statistics from the Current Population Survey, Unemployment Rate – 20 yrs. and over, White Men,” available at https://data.bls.gov/timeseries/LNS14000028 (last accessed February 2022).
- U.S. Bureau of Labor Statistics, “Labor Force Statistics from the Current Population Survey, Unemployment Rate – 20 yrs. and over, Black or African American Men,” available at https://data.bls.gov/timeseries/LNS14000031 (last accessed February 2022).
- Federal Reserve Bank of St. Louis, “Unemployment Rate – 20 Yrs. and over, White Men,” available at https://fred.stlouisfed.org/series/LNS14000028 (last accessed March 2022).
- U.S. Bureau of Labor Statistics, “Labor Force Statistics from the Current Population Survey, Unemployed persons by age, sex, race, Hispanic or Latino ethnicity, marital status, and duration of unemployment,” available at https://www.bls.gov/cps/cpsaat31.htm (last accessed February 2022).
- Austin and others, “Assessing the First Year of Biden, in Graphs.”
- Kyle Ross, “2021 Was a Year of Bold Economic Policy That Must Be Extended,” (Washington: Center for American Progress, 2022), available at https://www.americanprogress.org/article/2021-was-a-year-of-bold-economic-policy-that-must-be-extended/.
- Coronavirus Aid, Relief, and Economic Security Act of 2020, Public Law 116-136, 116th Cong., 1st sess. (March 27, 2020), available at https://www.congress.gov/bill/116th-congress/house-bill/748/text?q=%7B%22search%22%3A%5B%22coronavirus+aid+relief+and+economic%22%5D%7D&r=2&s=1.
- Ava Kofman and Hannah Fresques, “Black Workers Are More Likely to Be Unemployed but Less Likely to Get Unemployment Benefits,” ProPublica, August 24, 2020, available at https://www.propublica.org/article/black-workers-are-more-likely-to-be-unemployed-but-less-likely-to-get-unemployment-benefits.
- Alexandra Cawthorne Gaines, Bradley Hardy, and Justin Schweitzer, “How Weak Safety Net Policies Exacerbate Regional and Racial Inequality” (Washington: Center for American Progress, 2021), available at https://www.americanprogress.org/article/weak-safety-net-policies-exacerbate-regional-racial-inequality/.
- Kofman and Fresques, “Black Workers Are More Likely to Be Unemployed but Less Likely to Get Unemployment Benefits.”
- Algernon Austin, “The Job Crisis for Black Men is a Lot Worse Than You Think” (Washington: Center for Economic and Policy Research, 2021), available at https://cepr.net/report/the-jobs-crisis-for-Black-men-is-a-lot-worse-than-you-think/.
- Austin, “The Job Crisis for Black Men is a Lot Worse Than You Think.”
- Andrew Van Dam, “The latest twist in the ‘Great Resignation’: Retiring but delaying Social Security,” The Washington Post, November 1, 2021, available https://www.washingtonpost.com/business/2021/11/01/latest-twist-great-resignation-retiring-delaying-social-security/.
- Angela Hanks, Danyelle Solomon, and Christian E. Weller, “Systemic Inequality: How America’s Structural Racism Helped Create the Black-White Wealth Gap” (Washington: Center for American Progress, 2018), available at https://www.americanprogress.org/article/systematic-inequality/.
- U.S. Bureau of Labor Statistics, “Persons with a Disability: Labor Force Characteristics — 2021, Press release, February 24, 2022, available at https://www.bls.gov/news.release/pdf/disabl.pdf.
- The COVID Tracking Project, “The COVID Racial Data Tracker,” available at https://covidtracking.com/race (last accessed February 2022).
- Authors’ calculations based on Sarah Flood and others, “Integrated Public Use Microdata Series, Current Population Survey: Version 9.0 [dataset],” available at https://doi.org/10.18128/D030.V9.0 (last accessed March 2022).
- Authors’ calculations using U.S. Bureau of Labor Statistics, “Labor Force Statistics from the Current Population Survey: Race and Hispanic or Latino ethnicity,” available at https://www.bls.gov/cps/demographics.htm#race (last accessed March 2022).
- Austin, “The Job Crisis for Black Men is a Lot Worse Than You Think.”
- Danyelle Solomon, Connor Maxwell, and Abril Castro, “Systemic Inequality and Economic Opportunity” (Washington: Center for American Progress, 2019), available at https://www.americanprogress.org/article/systematic-inequality-economic-opportunity/.
- U.S. Bureau of Labor Statistics, Labor Force Statistics From the Current Population Survey: Employed persons in nonagricultural industries by age, sex, race, and Hispanic or Latino ethnicity,” available at https://www.bls.gov/cps/cpsaat14.htm (last accessed March 2022).
- The COVID Tracking Project, “The COVID Racial Data Tracker.”
- Michelle Holder, ”African American men and the U.S. labor market during recessions and economic recoveries,” Washington Center for Equitable Growth, February 11, 2022, available at https://equitablegrowth.org/african-american-men-and-the-u-s-labor-market-during-recessions-and-economic-recoveries/.
- Emily Moss and others, “The Black-white wealth gap left Black households more vulnerable,” Brookings Institution, December 8, 2020, available at https://www.brookings.edu/blog/up-front/2020/12/08/the-Black-white-wealth-gap-left-Black-households-more-vulnerable/.
- U.S. Census Bureau, “PINC-05. Work Experience-People 15 Years Old and Over, by Total Money Earnings, Age, Race, Hispanic Origin, Sex, and Disability Status: 2020,” available at https://www.census.gov/data/tables/time-series/demo/income-poverty/cps-pinc/pinc-05.html (last accessed January 2022).
- John Creamer, “Poverty Rates for Blacks and Hispanics Reached Historic Lows in 2019: Inequalities Persist Despite Decline in Poverty for All Major Race and Hispanic Origin Groups,” U.S. Census Bureau, September 15, 2020, available at https://www.census.gov/library/stories/2020/09/poverty-rates-for-blacks-and-hispanics-reached-historic-lows-in-2019.html.
- Moss and others, “The Black-white wealth gap left Black households more vulnerable.”
- Christian E. Weller and Richard Figueroa, “Wealth Matters: Black-White Wealth Gap Before and During the Pandemic” (Washington: Center for American Progress, 2021), available at https://www.americanprogress.org/article/wealth-matters-Black-white-wealth-gap-pandemic/.
- U.S. Census Bureau, “Quarterly Residential Vacancies and Homeownership, Fourth Quarter, 2021,” Press release, February 2, 2022, available at https://www.census.gov/housing/hvs/files/currenthvspress.pdf.
- Brent Kessel, Kamila Elliott, and Ako Ndefo-Haven, “Two American Financial Plans: The Next 50 Years of the Racial Wealth Gap and What You Can Do About It” (Two American Financial Plans, 2021), available at https://theracialwealthgap.com/.
- Austin, “The Jobs Crisis for Black Men is a Lot Worse than You Think.”
- Infrastructure Investment and Jobs Act of 2021, Public Law 117-58, 117th Cong., 1st sess. (November 15, 2021), available at https://www.congress.gov/bill/117th-congress/house-bill/3684/text.
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