June 18, 2024
The Black prime-age (25 to 54 years old) annual employment rate is currently at its highest level in a generation. This is good news for Black workers, their families, and their communities. It is important to acknowledge this positive development, but it is also important to acknowledge that the Black employment rate is still substantially below the White rate.
This brief examines the prime-age Black jobs gaps and deficits for men and women at the state level. The Black jobs gap is the difference between the White and Black employment to population ratios or employment rates. The jobs deficit is the number of additional jobs Black people need to have the same employment rate as their White peers. The analysis uses the 2022 American Community Survey data.
The employment to population ratio or the employment rate simply captures the portion of a population that is working. It does not assess why individuals are not working. In an equitable country, one would expect the 25- to 54-year-old Black population to be employed at a similar rate to their White peers. Because of the experience of discrimination in the labor market, community economic underdevelopment, and other socioeconomic inequalities, Black participation in the labor market may be lower than White’s. These factors can cause the unemployment rate to underestimate joblessness in the Black population. By examining the White-Black difference in employment rates, one obtains a more complete estimate of joblessness in Black America.
This analysis calculates the Black jobs gaps and deficits for prime-age men and women separately. Historically, men have had a higher employment rate than women, but the gender gap is much smaller today than in the past. Women have seen increases in their prime-age employment rates since the 1960s. Men’s rates have declined over time, especially for Black men when one considers the large numbers of Black men who are incarcerated (the incarcerated are not typically counted in labor market statistics). (See “The Three Labor Market Struggles Facing Black America” for additional details.)
This brief presents prime-age jobs gaps and deficits. The picture for other age groups could differ substantially. There are three important and distinct labor market inequalities when assessing the Black population: the number of jobs, the quality of jobs, and the types of jobs. (See “The Three Labor Market Struggles Facing Black America” for additional details.) This brief looks only at the relative number of jobs.
For men, there were 37 states with sufficient data for analysis. In 2022, there were only two states without any statistically significant difference in the White and Black employment rates for men (see Table 1). (See the Appendix for the methodology.) They were Delaware and Kentucky.
At the other end of the spectrum, three states had White-Black employment rate gaps that approached 20 percentage points. White men in Michigan had an employment rate 17.2 percentage points higher than Black men. Louisiana and Illinois had gaps of 15.5 and 15.1 percentage points, respectively. The smallest gaps were in Massachusetts (3.3 percentage points) and Colorado (3.6 percentage points).
The overall size of the Black population in a state will affect the size of the Black jobs deficit. The largest deficit for Black men was in New York. Black men in New York needed an additional 66,700 jobs to have the same employment rate as their White peers. Texas had the second largest deficit for Black men at 55,100 jobs.
For women, there were 31 states with sufficient data for analysis. Delaware and Kentucky again had no Black jobs gap for women. These are the only two states where both Black men and Black women have comparable employment rates to their White peers.
For Black men, only in Delaware and Kentucky did they have comparable employment rates with White men. But for women, there were 17 additional states where Black and White women had very similar employment rates. This means that in 17 states, the Black jobs deficit is solely Black men’s jobs deficit.
The largest jobs gap for Black women was in Iowa. In that state, White women’s employment rate was 12 percentage points higher than Black women’s. The next largest gaps were in the 8- to 9-percentage-point range. Wisconsin (8.6 percentage points), Illinois (8.5 percentage points), Michigan (8.5 percentage points), and Minnesota (8.1 percentage points) were all in this range. Illinois and Michigan also were in the top five largest jobs gaps for Black men.
In terms of the number of jobs, the largest jobs deficit for Black women was in Illinois. In Illinois, Black women needed an additional 29,800 jobs to have the same employment rate as White women. New York (25,000) had the second largest. Michigan (22,700) and California (21,100) also had jobs deficits for Black women that exceeded 20,000.
The top three states for the total Black jobs deficits were New York (91,700), Illinois (73,100), and Michigan (61,500). These states have relatively large Black jobs gaps and jobs deficits for both Black men and Black women.
When the national average unemployment rate is low, there are still many communities facing high rates of joblessness. For example, in 2023, while the unemployment rate averaged 2.7 percent in Ann Arbor, Michigan, it was 9.0 percent in Flint, Michigan. For reasons mentioned above, the unemployment rate is likely undercounting the joblessness in Flint. (For more on this issue, see also “Masking Real Unemployment: The Overall and Racial Impact of Survey Non-Response on Measured Labor Market Outcomes.”)
For this reason, it is useful to have a jobs program that can be targeted to communities facing high rates of joblessness. One of the most effective ways to create jobs is with subsidized employment programs. With these programs, the state or local government can cover some or all of the costs of hiring workers. If these programs are coupled with broader economic development plans, they could revitalize communities that have suffered from long-term underdevelopment or disinvestment, like Flint.
With a well designed and implemented program, a few years of subsidized employment could more than pay for itself. Good short-term subsidized employment programs can produce a long-term reduction in social welfare spending, a long-term increase in tax revenues, and a long-term reduction in crime and criminal legal system costs. (See More Lessons Learned From 50 Years of Subsidized Employment Programs for additional details.) State and local governments should implement these programs in their communities that suffer from high rates of joblessness.
The following applies to all states except for Black women in Maine.
Employment to population ratios or employment rates were calculated with 90 percent confidence intervals. Estimates with non-overlapping White and Black intervals are considered to be different. For estimates that are statistically different, estimates of the White-Black jobs gaps and deficits are calculated. If the Black employment rate is higher than the White rate, the state is designated as having no jobs gap.
If the White and Black confidence intervals overlap, they are not considered to be statistically equal unless the length of the Black confidence interval is not more than 10 percent of the Black estimate. For example, for prime-age Black women in Idaho, the 2022 employment rate estimate was 74.6 percent while it was 73.4 percent for White women. However, the confidence interval spanned from 51.9 to 88.9 or 37 points. 37/ 74.6 = 0.496 or 49.6 percent of the estimate. The range of the confidence interval was too large to be included. Idaho is listed as having insufficient data for Black women.
In 2022, the estimate of the prime-age employment rate for Black women in Maine was 57.0 percent. For prime-age White women it was 80.6 percent. The confidence intervals are non-overlapping, yielding a Black jobs gap of 23.6 percentage points and a Black jobs deficit of 1,000. This information is not included in Table 1 because it is suspect.
Estimates for prime-age White men, White women, and Black men in Maine for 2018, 2019, 2021, and 2022, have a basically level trend, but for Black women there is a dramatic decline. In 2018, the employment rate for Black women was 79.5 percent. In 2022, 57.0 percent. Black women are the only group to show a dramatic decline. This suggests that there may be some problem with the data for Black women. It is worth examining this issue further to understand if this is an error due to sampling or some other issue or a real trend.
