Joblessness for Black Workers Rises Amid Federal Layoffs and Diversity Initiative Rollbacks

Strategic Insights -

Joblessness for Black workers in the US has risen again, two years after reaching a record low, with the unemployment rate surging over the past four months from 6 to 7.5 percent, while the rate for white people ticked down slightly to 3.7 percent. The African American unemployment rate has increased disproportionately due to the Trump administration's assault on diversity programs and cuts to the federal workforce, which have weakened the historically strong labor market for Black workers. Economists say that joblessness often spikes higher for historically marginalized groups during economic downturns and takes longer to fall.

Key Takeaways:

  • The African American unemployment rate has surged over the past four months from 6 to 7.5 percent, while the rate for white people ticked down slightly to 3.7 percent.
  • The Trump administration's assault on diversity programs and cuts to the federal workforce have disproportionately harmed Black workers, economists say.
  • At least since the 1970s, when the federal government started tracking unemployment by race, the rate for Black people has run about twice the rate for white people due to inferior educational opportunities, mass incarceration, and discrimination.
  • Generous public subsidies cushioned the blow of the Covid-19 pandemic on Black workers, but hiring slowed and high prices weighed heavily on low-income earners after pandemic-era subsidies expired.
  • Job losses are concentrated among Black women working in professional services, such as human resources, according to Valerie Wilson's analysis of federal data.
  • A hiring freeze and mass layoffs in the federal workforce have fallen disproportionately on Black workers, exceeding 200,000, and limiting entry-level job opportunities for young workers.
  • State and local governments have picked up some of the slack from federal agencies, but competition for those jobs has gotten tougher with more laid-off public-sector workers looking for positions.
  • Lower interest rates proposed by the Federal Reserve may offer some relief, but Trump administration actions beyond workforce cuts and anti-D.E.I. policies could create additional hurdles for Black workers.

Statistics:

  • The African American unemployment rate surged from 6 to 7.5 percent over the past four months.
  • The rate for white people ticked down slightly to 3.7 percent.
  • Black households were the only racial group last year in which median income fell and the poverty rate rose, according to the Census Bureau.
  • Home care aides for the elderly are overwhelmingly Black and Hispanic women, who would be hurt by the Department of Labor's proposed rollback of minimum-wage and overtime protections.
  • Since the 1970s, the African American unemployment rate has consistently run about twice the rate for white people.

Sources:

  • "Federal layoffs and an end to diversity initiatives have weakened a historically strong labor market for Black workers." (Lydia DePillis, Federal layoffs and an end to diversity initiatives have weakened a historically strong labor market for Black workers)
  • "Joblessness often spikes higher for historically marginalized groups during economic downturns, and takes longer to fall." (Valerie Wilson, director of the program on race, ethnicity and the economy at the Economic Policy Institute)
  • "The federal government is one of those places people are able to get an entry-level job." (Gbenga Ajilore, chief economist at the Center on Budget and Policy Priorities)
  • "We know that an injury to one deeply is an injury to all." (Brittany Alston, director of the Philly Black Worker Project)