For African Americans, job prospects have improved since 2020. That’s the good news.
The bad news is that the gains made in the past two years, since the killing of George Floyd on May 25, 2020, sparked a national reckoning over race, look as fragile as ever. In fact, inflation threatens to disrupt progress in the labor market as politicians respond to a backlash against rising prices.
While the uprisings that brought thousands onto the streets in 2020 helped highlight the disadvantages of Black workers, most experts say government aid and the tight US labor market during the pandemic fueled the gains. groups for themselves and other groups.
A key measure tracked by economists shows that employment of black Americans of “optimum working age” (ages 25 to 54) rose to 77.4% in April, the highest in 22 years. While that’s still well below the equivalent measure for white Americans, the increase has narrowed the gap between the two figures to the narrowest on record, in data going back to 1994.
It’s a sign that the busiest job market in generations is making it “costlier for companies to discriminate against African-American job applicants,” according to Algernon Austin, director of racial and economic justice at the Center for Economic Research and Policy in Washington. . DC
The black unemployment rate has also returned to pre-pandemic levels. After the 2008-09 recession, it took nine years for black unemployment to return to pre-recession levels. This time, it only took two.
The figure stood at 5.9% in April, down from the 6% recorded for the group in February 2020 before COVID-19 shut down businesses in the US.
However, the economic divide between black workers and white workers persists. And, for many, the hope inspired by Black Lives Matter has been dashed by other racist killings, including this month’s mass shooting in Buffalo, New York.
The unemployment rate for black women, among the hardest-hit workers in the early months of the pandemic, has plummeted from 16.6% in May 2020 to 5%. But it’s still well above the 2.8% rate seen for white women.
“Overall, we’re seeing that, frankly, many black workers are able to take advantage of the tight labor market and strong employer demand to get jobs that would have taken them much longer in past recessions,” says Joelle Gamble, chief economist at the United States Department of Labor.
Part of the difference this time is related to the response of the US government and the Federal Reserve.
Instead of choosing a long and drawn out recovery with all its disproportionate consequences for Black Americans, as they did in the 2008-09 recession, lawmakers stepped in during COVID outbreaks with massive financial support for American households, transferring trillions to them. of dollars. through greatly expanded stimulus checks and unemployment insurance programs. That underwrote continued consumer spending in the economy, which in turn provided a basis for rehiring the recently laid off.
“In this recovery, we are less likely to see scars from workers unemployed for long periods of time,” says Gamble.
Black employment may also have gotten a boost this time around because of the unusual impact the pandemic had on industry-level hiring, according to Evgeniya Duzhak, an economist at the San Francisco Federal Reserve.
Duzhak found, in an analysis posted on the bank’s website on May 16, that black unemployment did not rise relatively during the pandemic as much as expected. That’s “in part because more than 25% of black men are employed in production, transportation, and material-moving occupations, and those occupations fared better than the service sector.”
But now, progress risks unraveling in an all-out effort to rein in inflation.
Policymakers in the White House and at the Federal Reserve are shifting their priorities from rebuilding the workforce to curbing price pressures through austerity measures, which threaten to slow or even reverse recent job gains. .
Republicans and two Democrats shunned President Joe Biden’s Build Back Better agenda, a far-reaching package that included several job creation initiatives and would have added more to government spending, citing the need to stifle inflation.
Perhaps even more important is the central bank’s response. Fed Chairman Jerome Powell and his colleagues have embarked on a rapid tightening cycle and warn that fighting inflation through higher interest rates is likely to drive up the unemployment rate and may even ultimately instance, induce another recession.
For observers like William Spriggs, an economics professor at Howard University and chief economist at the American Federation of Labor and the Congress of Industrial Organizations, that represents an existential risk to the entire effort to build a more inclusive economy, the need for which has long been recognized. dramatically underlined. by the events of the last two years.
“We’re still going to be the last ones hired, so if the unemployment rate goes up, it just undoes all the gains,” Spriggs said. “What’s the point of the tight job market? It is the necessary condition for the advancement of blacks.”