Black unemployment hits record low

The black unemployment rate fell to the lowest point recorded in March, 5 percent, a testament to the economic recovery after the pandemic.

The number is even more surprising, considering that just three years ago, at the height of the coronavirus pandemic, the black unemployment rate had risen to 16.8 percent with about 3.5 million black workers dropping out of the labor market or losing their jobs.

A surge in labor market demand emerging from the pandemic has fueled one of the fastest job recoveries on record, sending the national unemployment rate to historic lows and benefiting millions of black workers who had lost their jobs and quickly found new ones.

Whether these gains are lasting is uncertain, as economists predict a recession later this year. Black workers suffer disproportionately during recessions and economic downturns because a greater share of them work in low-wage industries that are more prone to layoffs.

“This has to do with the tight labor market,” said Daniel Zhao, chief economist at Glass Door. “Employers have been more aggressive in finding workers, which has benefited black workers. But if the economy slows, you could see a weakening of the labor market for black workers.”

Economists say black unemployment in the United States tends to be twice the white unemployment rate because of systemic racism and other broad structural forces, such as disparities in access to education.

The unemployment rate is even lower than in the years when then-President Trump often took credit for black unemployment hitting record lows during his tenure, according to data from the Bureau of Labor Statistics dating back to 1972.

The record low black unemployment rate is a victory for the Federal Reserve, which has been accused of widening economic inequality. With its years-long policy of lower interest rates helping more workers get and keep jobs, these policies also increase the wealth of people who have investments or want to buy homes, which can bypass Americans of color.

Fed officials have argued that a tight labor market is key to reaching groups that have historically been left on the economic margins.

The pandemic led to a sharp increase in black, Asian, and Latino homeownership

Fed Chairman Jerome H. Powell often says that his goal is to work toward a job market that lifts everyone up.

“I would go back to the labor market that we had in 2018. ’19, ’20,” Powell said at a press conference in December. “What it looked like was that the wage increases for people at the lowest end of the income spectrum were the greatest. The disparities between racial groups and gender groups were the smallest in recorded history. . . . So it seems like something that would be very good for the economy and for the country, if we could get back to it.”

Rachel Siegel contributed to this report.

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