The US jobs report released today (Jan. 7) showed some promising signs of recovery, with the share of jobless Americans dropping to 3.9%. That’s the lowest rate since the February prior to the coronavirus pandemic, when it was 3.5%. Average hourly wages rose by 4.7% compared to the previous year.
This better-than-expected unemployment rate doesn’t reflect everyone’s reality, though. Black Americans were the only US demographic group to see unemployment rise last month, highlighting a persisting racial disparity that’s worsened over the past two years.
Black workers have been slower to recover
Both Black and Latino workers were hardest hit by pandemic-related layoffs nearly two years ago, with the latter group initially seeing the steepest job losses. But Black Americans have been slower to recover than any other group. Industries that heavily employ Black workers—such as transportation, health services, and child care—have not rebounded as quickly as others.
In December, the unemployment rate among white workers dropped to 3.2%—the lowest level since prior to the pandemic—but rose to 7.1% for Black workers. Black women, in particular, were hard hit by job losses in December. Unemployment among this group rose by 1.3 percentage points, after dropping sharply in November.
“Many people put too much weight on the drop in November,” says Elise Gould, a senior economist at the Economic Policy Institute. “I hoped it was reflective of vast improvements to the labor market, but I’m not surprised to see the data course-corrected.”
There have been improvements to the job market for Black workers over the past year, Gould notes. The unemployment rate is down from its pandemic peak of 16.8% in May 2020. “But I’m certainly troubled by the fact that we’re now sitting at Black unemployment that’s more than twice as high as white unemployment,” she says.
Black workers are consistently unemployed at higher rates than white workers in the US, a disparity that’s persisted for years. But the gap is wider now than it was two years ago. The Black unemployment rate was 2.7 percentage points higher than the white unemployment rate in Dec. 2019, while today’s jobs report showed a gap of 3.9 points.
Gould stresses it’s important not to read too much into one month of data. It’s become harder to evaluate employment indicators during the pandemic. The number of jobs employers added in December, for example, paints a picture of a more subdued job market than the unemployment rate suggests. US jobs rose by 199,000 last month, less than half what economists had forecast, but that number could be revised upward as was the case in October and November.