Black unemployment report – July 2023
The unemployment rate for Blacks was unchanged at 5.8% while Labor Force Participation rate remained near recent highs (62.7%)
The Black unemployment rate was reported at 5.8% and the “Real” Black employment was 9.0% (see below). The National unemployment rate stood at 3.5%, and non-Farm Payrolls rose by 187,000. Wages had large increases. Hourly wages went up by 5%, while weekly wages jumped by 4%. Increases were year over year.
There was zero news in the unemployment report this month. The reaction from the stock market, the news media, commentators, economists and the Federal Reserve Bank was quiet. The report was largely ignored.
There were only two interesting items. One, the number of healthcare and social assistance jobs increased by 87,000, which dwarfed all other categories. If you want a job, look at healthcare (63K alone). And the jobs pay above average. The next largest increase was in the “Other Services” category which added 20,000 jobs.
It might be the perfect job report for the Biden administration and the Federal reserve bank (which controls interest rates) as wage pressure subsided helping to reduce inflation. Thanks to fiscal policy, we might be seeing the mythical soft landing.
Black Unemployment Report Details
Since we have not published a report recently, we want to comment on some post COVID trends in Black employment.
Blacks have returned to the labor force. Black Labor Force Participation remained strong at around 63%. The number of Blacks employed was 20.5 million.
The unemployment rate for Blacks has remained at record lows. While the rate has edged up slightly (5.8%) in the last month, we did hit a record low of 4.7% in April 2023. The current rate is among the lowest ever.
Black Women and Men continued to work in strong numbers. There were approximately 11 million Black women working and 10 million Black Men. The Black female unemployment rate was 5.2% and the Black male rate was 5.3%; both near historic lows. The rate of Black male unemployment was the closest to the Black female unemployment rate as we have seen since the pandemic. Black men are working in record numbers.
The Black Teenage (16-19) unemployment rate was 20.7% an increase of 5% over last month. 568,000 kids had jobs in July.
Hourly wages (5% increase) and weekly wages (4%) were up year over year.
The Unemployment Ratio between Blacks and Whites was 1.6, down from the average of 2.0. Historically, the Black unemployment rate has been double that of Whites. The trend over the past years has been downward toward 1.5 which would represent a lowering of employment discrimination against Black applicants.
During COVID, the ratio hit an all-time low of 1.1. Our folks were not only brave, but we also work in jobs like healthcare, hospitality, warehousing and transportation where remote work is not an option. The murder of George Floyd may have also reduced discrimination in hiring.
The number of employed Black workers increased slightly to 20.5 million an increase of 94,000 employees. Peak Black employment was 19.7 million in Feb 2020. Right before the pandemic.
The employment to population (EM) ratio (59.1%) has been slowly increasing after COVID. The EM ratio gives a general idea of the number of people working compared to the general population.
“Real” Black employment rate.
As is our custom, we calculate the “Real” Black unemployment rate. It was determined to be 9.0% in December. The Black unemployment rate increased but the US U-6 rate decreased during the period.
The U-6 is the broadest measure of unemployment reported by the Bureau of Labor Statistics. Many economists call U-6 the “Real” unemployment rate. In fact, U-6 was the official unemployment until President Clinton switched to U-3 in 1994. didn’t like the numbers. U-6 includes anyone who wants to work and has looked for a job in the past 12 months plus part time people who want full time work (the under employed).
To calculate the “Real” Black unemployment rate, we add U-6 plus the difference in general Black to White Employment. This figure is currently 3.2%. (U-6 = 6.7% minus U-3=3.5% is a 3.2% employment rate gap)
We also calculate the Discrimination Ratio or the Structural Racism Ratio which is the ratio of Black unemployment to White unemployment. The ratio, along with employment income, is the best overall indicator of discrimination in society. In a perfect world without discrimination, the ratio would be “1”. The ratio was about 1.6 in July. In an ideal world, Blacks and Whites would be employed at roughly the same rates.
Finally, there are three great measures of discrimination in US society: The ratio of Black to White unemployment (Short-term), the ratio of Black to White incomes (Medium-term. Education and profession based), and Black to White wealth (Long-term. Cumulative, historic, structural). It’s a quick way to keep score of the larger issues in our society.
The Discrimination Ratio dropped to all-time low of 1.1 during the COVID pandemic as many Black workers were considered “essential,” while White workers were considered non-essential.
Historically, the ratio of Black unemployment to White unemployment has been double since 1972.
End of Black Unemployment Report