Fact Sheet: LGBT Workers in the Labor Market

The COVID-19 pandemic and ensuing economic crisis resulted in significant hardship for people across the country: Tens of millions of people lost their jobs, unemployment rates increased, and economic activity declined. To mitigate these economic impacts, federal policymakers enacted multiple relief bills, including the American Rescue Plan Act. These investments shortened the recession in the wake of the pandemic and have helped propel a historic economic recovery resulting in the most jobs ever created in a single year, an unprecedented drop in unemployment, and dramatic reductions in the child poverty rate and food insufficiency. However, while the United States is experiencing a more equitable recovery compared with prior recessions, systemic inequities persist, particularly for LGBTQI+ communities.

Using new data from the Household Pulse Survey (HPS), this fact sheet examines the economic security and labor market experiences of LGBT communities since July 2021, when the U.S. Census Bureau took the historic step of adding questions on sexual orientation and gender identity to the HPS. The data reveal that although some LGBT individuals are more likely or just as likely to be employed compared with non-LGBT individuals, they are also more likely to live in households earning below the poverty line and to struggle to make ends meet.

For decades, compared with the general population, LGBTQI+ people have faced increased risk of experiencing economic insecurities, such as higher rates of poverty, unemployment, and public benefits use. Not only has the pandemic disproportionately affected LGBTQ people, but the recovery has also likely perpetuated existing inequities, leaving many LGBTQ workers stranded in low-quality jobs that offer poverty wages, few benefits, and limited protections.

While improving data collection on LGBTQI+ communities through labor-market-specific surveys more broadly is necessary to enhance the public’s and policymakers’ understanding of the proliferation of low-quality jobs among LGBTQI+ workers, the data demonstrate a clear need for the creation of good jobs that target LGBTQI+ people.

Impacts of the pandemic on the economic security of LGBTQI+ communities

Compared with the general population, LGBTQI+ people face significant challenges that obstruct pathways to achieving economic security, including discrimination in employment and housing, workforce exclusion, and lack of access to jobs that pay well and offer benefits that meet their needs and those of their families. For LGBTQI+ people with disabilities, LGBTQI+ communities of color, and transgender people, these barriers to reach economic stability are heightened. In many ways, the COVID-19 pandemic shed light on and likely exacerbated long-standing economic disparities faced by underserved communities, including people of color, people with disabilities, and LGBTQ people.

Evidence from earlier on in the pandemic reveals that LGBTQ households, especially low-income LGBTQ people and LGBTQ people of color, were more likely than non-LGBTQ households to experience food insecurity, loss of employment, significant financial challenges, and barriers to accessing health care as a result of the pandemic. Losses in employment income come at a time when the unemployment rate is at historic lows and employers are claiming that they are struggling to find workers amid the ongoing good jobs shortage.

New data from the HPS reveal that:

• LGBT households are more likely to live in poverty. LGBT individuals were more likely than non-LGBT individuals to report a household income of less than $25,000 in 2020, at 20 percent compared with 14 percent. Put another way, many LGBT individuals live in households that are at or near the poverty line. LGBT respondents of color (26 percent) and transgender respondents (28 percent) are even more likely to earn less than $25,000.
• LGBT households are more likely to report losing a source of employment income. On average, from July 2021 to April 2022, LGBT individuals were also more likely than non-LGBT individuals to report that they or someone in their household had lost a source of employment income in the past four weeks, at 21 percent compared with 15 percent. These disparities are heightened among LGBT respondents of color (26 percent) and transgender respondents (29 percent), which was a consistent trend for the past year. (see Figure 1)
• LGBT households experience more difficulty paying household expenses. On average, from July 2021 to April 2022, LGBT individuals were more likely than non-LGBT individuals to report that it has been somewhat or very difficult for their household to pay for usual household expenses in the past week, at 38 percent compared with 29 percent, with rates consistently highest among LGBT respondents of color (46 percent) and transgender respondents (50 percent). (see Figure 2) Usual household expenses include but are not limited to food, rent or mortgage, car payments, medical expenses, and student loans.

Figure 1

Figure 2

Labor market experiences of LGBTQI+ workers

LGBTQI+ people experience labor market disparities, as they often struggle to find employment; when they do, they often work in low-wage occupations. While some LGBT workers have higher employment rates than non-LGBT individuals, as explained above, they still struggle to make ends meet. The experience of LGBT individuals in the paid labor market is a reminder that job quality, and not merely job attainment, is critical to economic security.

New data from the HPS reveal that:

• LGBT people work more and at higher rates. LGBT respondents were more likely than non-LGBT respondents to report working in the past seven days, at 65 percent compared with 57 percent. (see Figure 3) Across all age groups, LGBT respondents were either more likely than or just as likely as their non-LGBT counterparts to work over time. While this signals that employment rates are fairly equitable across populations, it also masks the disparities experienced in job quality and economic insecurity. However, transgender respondents experienced lower employment rates than both other groups within the LGBT community and non-LGBT people, signaling a challenge in attaining employment.
• LGBT people are more likely to work at grocery and convenience stores. LGBT respondents were nearly twice as likely as non-LGBT respondents to report working at food or beverage stores, which include grocery stores and convenience stores, at 11 percent compared with 6 percent. LGBT respondents of color (12 percent) and transgender respondents (14 percent) were also more likely to report working at food or beverage stores.
• LGBT people are more likely to use unemployment insurance. LGBT respondents, particularly transgender respondents, were more likely than non-LGBT respondents to report receiving unemployment insurance since January 2022. This likely underestimates the number of respondents who are both unemployed and eligible for unemployment insurance.

Figure 3

Recommendations

While the economic recovery has been more equitable than prior recoveries, existing inequities persist among LGBTQI+ communities, particularly in the labor market. The U.S. labor market must foster equitable opportunity for all, including LGBTQI+ workers. Policymakers can help ensure this occurs by expanding and improving LGBTQI+-inclusive data collection and promoting good jobs for LGBTQI+ workers.

Enhance LGBTQI+-inclusive data collection

Enhancing data collection on sexual orientation, gender identity, and variations in sex characteristics, including intersex traits, is critical to providing policymakers and researchers with the tools necessary to craft policy solutions that reduce disparities and advance equitable outcomes for LGBTQI+ communities.

CAP recommends that:

• The Biden-Harris administration add measures of sexual orientation, gender identity, and variations in sex characteristics, including intersex traits, to the following priority surveys, which collect indispensable data on the social, economic, housing, public benefit use, and demographic characteristics of households across the country: the American Community Survey, the Current Population Survey, and the Survey of Income and Program Participation.
• Congress pass the LGBTQ Data Inclusion Act to add questions on sexual orientation and gender identity to federally supported surveys and expand the bill to include data collection on people with intersex traits.
• The Biden-Harris administration and Congress allocate funding to support the efforts of agencies to adopt these questions on federally supported data collection instruments and to invest in ongoing research to continue testing and improving question design.

Promote good jobs for LGTBQI+ workers

Good jobs should be available to all workers, regardless of gender identity, sexual orientation, or intersex status. These jobs should not only offer fair wages that allow workers to support themselves and their families but also include the health benefits that LGBTQI+ workers need and support workers’ right to come together in unions. For transgender and disabled LGBTQI+ workers in particular, jobs often fall short of offering critical health benefits on top of paying poverty wages that leave workers unable to make ends meet.

CAP offered guidelines and recommendations for policymakers interested in creating good jobs for LGBTQI+ workers and their families in its report from April. In addition to collecting better data on the economic well-being of LGBTQI+ Americans, the report recommends that policymakers:

• Ensure that jobs funded through federal spending are good jobs for LGBTQI+ workers and their families.
• Make existing anti-discrimination protections real by empowering LGBTQI+ workers to stand up for their rights.
• Build pathways to good jobs through apprenticeships and training focused on LGBTQI+ workers and youth.
• Support the right of workers to come together in solidarity and promote collective bargaining as a means of strengthening protections for LGBTQI+ workers.
• Lead through federal example by making sure the federal government is a model employer for its direct public employees.

Conclusion

The experiences of LGBTQI+ workers, including LGBTQI+ workers of color and transgender workers, within the labor market have not been well documented due to a lack of available data. Using new HPS data, this fact sheet reveals that LGBT workers face economic insecurity and are likely overrepresented in low-paid occupations. While limitations in the data point to a broader need for job quality and labor market surveys that ask questions on gender identity, sexual orientation, and variations in sex characteristics, including intersex traits, the HPS data underline the urgent need for policymakers to include LGBTQI+ workers in their efforts to create good jobs.

The authors would like to thank Anona Neal, Lily Roberts, Karla Walter, and Nicole Lee Ndumele for their input and review.

Methodology

As of this publication, 11 iterations of the HPS include questions on sexual orientation and gender identity. Collectively, the data include 51,216 LGBT individuals, 647,603 non-LGBT individuals, 13,694 LGBT people of color, and 3,121 transgender individuals. The data were weighted to account for nonresponse, adults per household, and coverage. All in-text statistics comparing LGBT respondents with non-LGBT respondents are significant at the 0.05 level. Data and a detailed methodology are on file with the authors and available publicly via the Census Bureau.

• Respondents coded as “LGBT” include those who reported that 1) they were “Gay or lesbian,” “Bisexual,” and/or “Transgender”; 2) their gender assigned at birth was “Male” and that their current gender identity is “Female”; and/or 3) their gender assigned at birth was “Female” and that their current gender identity is “Male.” Respondents who met criteria 2) or 3) were coded as transgender.
• Respondents coded as “people of color” include those who reported that they were 1) “of Hispanic, Latino, or Spanish origin”; 2) “Black, alone”; 3) “Asian, alone”; or 4) “Any other race alone, or race in combination.”
• The Census Bureau imputed gender assigned at birth where it was not provided. For the purposes of accurately identifying transgender respondents, those with imputed gender assigned at birth were removed from the sample.