Black Burdens, White Wages, and the Persistence of Economic Inequality

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The Equal Employment Opportunity Commission recently announced that beginning in March 2018, the agency plans to require employers with 100 or more employees to provide wage data broken down by race, gender, and ethnicity. “Collecting data is a critical step in delivering on the promise of equal pay,” U.S. Secretary of Labor Thomas E. Perez said in statement. “Better data will not only help enforcement agencies do their work, but it helps employers to evaluate their own pay practices to prevent pay discrimination in their workplaces.”

The EEOC move comes on the heels of a troubling Economic Policy Institute (EPI) report published in late September. The study analyzes wage data from 1979 through 2015 and splinters the narratives of African American economic progress often offered by the left and the right. EPI researchers found that rhapsodic accounts of black advancement can be misleading: The report documented that wage inequality is more acute today than it was more than 35 years ago. Set alongside other observations about race, class, gender, and work, these findings are even more striking.

The trope that African Americans have to work “twice as hard” or be “twice as good” to obtain economic parity with whites circulates throughout society—from popular culture to presidential speeches. Blacks have faced unemployment rates that have been almost twice as high as whites since the Bureau of Labor Statistics began collecting data in 1954; they are underrepresented in high-paying fields, and are less likely to receive job leads for supervisory positions. These issues are compounded for black women, and make the data on economic inequality unsurprising, if not inevitable.

The EPI study, co-authored by economists Valerie Wilson and William Rodgers III, is especially revealing. It identifies how observable attributes such as education and experience as well as unobservable characteristics such as discrimination can influence racial disparities in wages. Discrimination is one of the main subjects of their analysis. Most notably, they find that the gap between black and white workers’ wages has actually increased since 1979. In that year, when white employees on the lower end of the wage spectrum made $9.24 an hour, their black counterparts made $8.90. Not ideal, but not shocking. By 2015, the gap jumped up to nearly 12 percent, with white workers making $9.30 an hour and black workers making $8.20. When multiplied over a 40-hour work week for the year, not good.

On the upper end of the wage spectrum, the gap widened. In 1979, white workers made $39.08 an hour compared to $30.84 for black workers, which equates to a roughly 20 percent wage gap. By 2015, this gap increased to about 30 percent, with whites making $61.12 and blacks earning $42.07.

The black economic experience has not been monolithic: Black women’s economic realities produce unique inequalities. Economists and African American historians have long shown how, despite being segregated into devalued jobs, marred by exploitation, and carved out from social welfare protections, black women were more likely to participate in the workforce from 1870—fresh off the heels of emancipation—until 1980. In 1979, notwithstanding black women’s economic insecurities, the wage gap between experienced black and white women was a little more than 1 percent. But by 2015, this gap increased to nearly 13 percent. This gap suggests that women’s entrance into the workforce was uneven. It also demonstrates that black women’s expansion into the workforce did not necessarily produce the substantial economic gains or professional advancement it did for white women.  

Lower wages for a sole income-earner because of her race and gender raises serious public policy issues; it also prompts concerns about the economic vitality of black families. Earlier this year, Joan Harrigan-Farrelly, the deputy director of the Women’s Bureau at the U.S. Department of Labor, noted that black women are often raising families either on their own, or as a primary breadwinner; four in ten African American families with children were headed by a single working mother in 2014.

(Source: Economic Policy Institute)

The significance of the wage gap for black women extends beyond child-rearing and families; it affects them later in life. Labor Department data indicates that black women experience the highest rates of poverty among people 65 years of age and older. According to the department, “the lower earnings [that a black woman] has experienced mean that she will likely collect less from Social Security, less from a pension, if she has one, and will have less money in the bank or invested in financial assets than she would have absent the wage gap.” Since women tend to live longer than men, women are more likely to run into financial difficulties as they spend down their resources. EPI’s finding about the increased wage gap has important consequences for older black women as well as younger black women who will later join the ranks of the elderly.

Economic distress has been real for African American men, too. The dire plight of black men is at least superficially understood by the general public, thanks to highly publicized police killings, cultural stereotypes about black shiftlessness, and the outsized role black men occupy in social justice conversations vis-à-vis black women. One popular narrative for black men is quite simple: Black men attend lousy schools, are considered unruly in and by their educational institutions, and railroaded through the school-to-prison pipeline. They are criminalized, released with the mark of a felony record, and because of some combination of these factors, are not only unable to obtain higher education, but are resigned somewhere between perpetual unemployment and low-wage labor. (Young black women also encounter many of the same problems.)

Hidden underneath these views is the idea that education and jobs will mitigate inequality. But higher education does not guarantee wage equity. The wage gap for male college graduates—a relatively privileged group that did some of the things that American society demands—is still disturbing. The EPI report found that in 1979, the wage gap for new black male workers who had a bachelor’s degree or more was a little under 5 percent; by 2015 it was 18 percent. There was a similar increase in the wage gap for black college-educated women. These developments might invite questions about the utility of a college education, but “college will still be an effective way of increasing mobility, unquestionably,” says EPI’s Wilson. “It’s not about college having no economic benefit.” The issue, Wilson adds, is about college’s inability to reduce racial disparities.

“Education is not the great equalizer,” says Darrick Hamilton, an economist at the the New School and a co-author of a report on race, education, and disparities. Education will not buffer blacks from police harassment, nor does it cushion them from economic inequality. This is especially disconcerting since black students carry high college debt (on average $9,000 more than their white peers). To discussions about free community college, the underrepresentation of black students at increasingly expensive public universities, and continued attacks on affirmative action, educators and economists must also ask: Can colleges provide the necessary tools to reduce racial wage gaps, and if so, how?

There are measures that, if used in conjunction with vigorous anti-discrimination enforcement tools, could help reduce the racial wage gap. CNN’s Tanzina Vega, who moderated a recent EPI forum on the racial wage gap, suggested that employers pay closer attention to what she called “assignment equity.” Using the journalism industry as an example, she asked, “what types of assignments are we giving different people of color? What assignments are the women getting?” She noted that there are merit differences, such as higher pay, that could come with being a science or business reporter as opposed to being a general assignment reporter who covers a wide range of stories. Similar distinctions in assignments take place across white-, blue-, and pink-collar professions that could influence wages.

The EEOC recently announced that its new program that requires employers to collect employee wage and promotion statistics by race and gender will help federal officials identify instances of discrimination. (The plan, one that the EPI report recommended, is similar to a pilot program that went by the wayside during the Clinton administration.) Nevertheless, Dorian Warren, a fellow at the Roosevelt Institute, a liberal New York think tank, who also participated in the EPI forum, cautioned against exclusive use of a “mid-20th century range of tools to combat employment discrimination,” adding “we need to reimagine what are the tools in the 21st century.” Ultimately, rectifying the socioeconomic problem of racial wage disparities will require creative input and commitments from multiple levels and branches of government, and from higher education, employers, unions, and workers.  

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