Understanding the black jobs crisis

Too few black teens are working this summer. Too few black men are working this year. Do our leaders really understand the problem? Does anyone have an adequate response?

The employment rate for black teens is abysmal. For teens overall, the employment rate last year was the lowest since World War II, according to research by the Center for Labor Market Studies (PDF link). That was the picture last year before the full onset of the economic downturn. Things are bad overall, but, as most people know, they are always worse for blacks. For whites, the teen employment rate last year was 38.3 percent. For blacks, it was 21.4 percent.

We can gain a full appreciation of the problem for black teens by looking at summer employment by class background. For the most part, teen employment rates increase with class background. Black teens from well-off families making $75,000 to $100,000 a year had a summer employment rate of 30 percent last year. This employment rate is significantly higher than the rate for black teens from impoverished families. Black teens from families earning less that $20,000 a year had an employment rate of 18 percent.

Although teens from middle-class black families are much better off than black teens from poor families, middle-class black teens are still worse off than white teens. Even white teens from impoverished families had a higher employment rate than middle-class black teens. Poor white teens had a summer employment rate of 37 percent, 7 points higher than the well-off black teens discussed above. These poor white teens had the lowest employment rates among whites, but they still beat the highest teen employment rates among blacks.

The situation for black men is bad also. Last year, the employment rate for black men in the prime working ages of 25 to 54 was 11 percentage points less than for white men in this age group. For blacks, that difference amounts to over 700,000 men without jobs.

Many argue that the key is to have more black men stay in school and earn college degrees. More education is a good idea for many reasons, but, unfortunately, it's only a partial solution to the black employment crisis.

Education definitely helps. The employment rate for blacks who did not have a high school diploma was 54 percent. For blacks who had a four-year college degree it was 90 percent. Being better educated improves one's job prospects.

The gap in the employment rate between black and white men, however, is not just about education. At every education level, whites are more likely to be employed than blacks. White male college graduates had a 4 percentage-point employment rate advantage over their black male peers. The white male advantage over black males for high school dropouts was a whopping 15 percentage points wide.

Surprisingly, the largest employment rate gap is among the least educated men. This finding is the opposite of what many people believe. Many people think that blacks are not finding work mainly because they are not receiving the necessary education for professional and high-tech jobs. But the larger problem is that, for some reason, black male high school dropouts can't get the jobs that white male high school dropouts get.

I've looked at the education issue concretely by calculating the employment-rate gap for black and white men if black men had an educational profile identical to white men. Last year's gap for prime-age men of 11 percentage points drops to 8 percentage points with this adjustment. Black men make progress but most of the employment-rate gap remains. Most of the gap, therefore, is due to what's going on with employers in the labor market, not what black men lack in education.

For some reason black teens--even middle-class black teens--are having a much harder time finding work than even the poorest white teens. For some reason, white men who dropout of high school are much more employable than black men who dropout of high school. Why is this? We aren't going to be able to answer this question as long as we are blinded by the rhetoric of "color-blindness." It is the twenty-first century, but race still matters.