April 15, 2024
Black male unemployment rate rose in January, underscoring persistent inequality

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Black people lost their place in the workforce last month, reflecting the persistence of entrenched inequities in the US labor market.

The unemployment rate among black men at least 20 years old was 5.3% in January, up from 4.6% in December, according to seasonally adjusted data from the Labor Department. When broken down by gender among black, Hispanic, and white workers, these workers had the highest unemployment rates.

By comparison, January saw the unemployment rate for whites just 3.3%, steady from December. The overall unemployment rate was unchanged from December at 3.7%.

Meanwhile, the black community as a whole was the only tracked racial group to see a rise in unemployment since December. This underscores the impact of job loss among black men, especially considering the fact that the rate for black women was unchanged at 4.8% between December and January.

However, Alice Gold, senior economist at the Economic Policy Institute, said the rise in the unemployment rate for black men should be monitored, but it may indicate an anomaly in December’s low data. January’s 5.3% rate comes basically in line with the 2023 month average, while December’s 4.6% rate was the lowest seen in the year.

He said the tight labor market experienced during the pandemic helped narrow the gap in work-related opportunities between Black and white men. In fact, the unemployment rate gap between black and white men narrowed to 2 percentage points in January, from 4.1 percentage points in the same month in 2019.

The increase in the total number of employed black men and the ratio of those employed to the total population compared to the beginning of 2023 also paint a picture of improvement, he said.

But Gould said persistent inequality in employment and wages highlights the need for further social progress, while stressing the argument that a stronger labor market alone will not bring equality.

According to federal data for the last quarter of 2023, the average weekly wage for the average white worker age 16 or older was nearly 20% higher than that of their Black counterparts. This disparity increased to nearly 25% when looking at male workers alone.

“An improved economy could certainly help historically disadvantaged groups more because they are the ones who are often left out and slower to recover in lean times,” Gold said. “Full employment is certainly a requirement for many historically marginalized groups to be able to see positive impacts in the labor market, but it is not the only thing.”

He pointed to unions as an example of a positive force for black workers, noting that pay transparency among members could help reduce any racial pay gap.

Combining the genders, the unemployment rates for white and Asian workers fell in January to their lowest level since last fall. The rate of unemployed Hispanics remained steady at 5% from December, while the share of unemployed black workers increased from 5.2% to 5.3%.

Gould warned that the month-to-month changes seen in the unemployment rate for black men could be unsustainable. Because of this, he said it is important to evaluate long-term trends before drawing conclusions.

Still, Gold said that observing employment patterns among black workers and other marginalized groups could be important for spotting key economic trends. He said that’s true even though comprehensive employment data released on Friday indicates a “hot” labor market.

“It’s a canary in the coal mine,” she said. “When you’re thinking about where you’re going to see signs of a recession, you’re not going to see it in today’s data, but it’s always something to keep an eye on.”

— CNBC’s Gabriel Cortes contributed reporting.

Source: www.cnbc.com

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