Protests against systemic racism have swept the U.S. and the globe causing Americans to confront the deeply-rooted discrimination that exists in most facets of life. Demands for change have started to pivot from racism in criminal justice to now include calls for addressing the widespread inequality in America’s employment system and undoing the policies that leave people of color mired in low-paying, less-secure jobs that are vulnerable to economic downturns.
Income, wealth and employment disparities are the result of a complex mix of historical racism, deep-rooted structural issues and continued discrimination. While Americans largely agree on the importance of racial and ethnic diversity in the workplace, entrenched inequalities in education, housing, healthcare and criminal justice prevent this vision from becoming a reality.
There was a very public attempt to address the role that institutional racism plays in inequality more than 50 years ago by the Kerner Commission. They found white society was deeply complicit in the discriminatory policies that led to the civil unrest and political upheaval in Black neighborhoods during the mid- to late-1960s. President Lyndon B. Johnson ignored the panel’s recommendations, and today’s protests show that little has changed in communities of color since.
Andre Perry, fellow at the Brookings Institute and author of “Know Your Price: Valuing Black Lives and Property in America’s Black Cities,” says if we don’t restore the wealth and value extracted by racism through reparations, we aren’t truly interested in creating an equitable society. To do so, we must address the underlying issues.
“If you had an aquarium, structural racism would be the water. We have been turning up the heat in the water and asking the fish to cool off,” Perry says.
From tech companies like Google and Facebook and food & beverage purveyors like Pepsi and McDonald’s to retail giants like Target and Walgreens and financial services providers like Wells Fargo and Chase, captains of industry have been pledging time and money to increase diversity in their ranks. Now more than ever leaders are emphasizing the importance of creating a pipeline for people of color from entry-level positions all the way up to the c-suite, and they are measuring the outcomes of their efforts in annual reports.
But systemic racism’s impact on employment can’t be fixed by HR workshops and diversity pledges alone. The issue is insidious and deeply-entrenched in our society. The more the corporate brass understand this, the better prepared they’ll be to help Black job seekers get a fair shake.
Disparities in employment are rooted in America’s history of racism
Each racial and ethnic minority group has its own story of oppression in the U.S.
Asian Americans were once barred from entering the country based solely on race. President Franklin Delano Roosevelt forced Japanese Americans into internment camps during World War II. Vigilante mobs were lynching Latinos into the 1920s, and during the Great Depression, the U.S. forcibly removed up to 1.8 million people of Mexican descent from the country. More than half were American citizens.
Nonetheless, such virulent racism is overshadowed by the long-standing and deeply rooted discrimination against Native Americans and Blacks in this country. Native Americans were forced to relocate repeatedly as each promise by the U.S. government was broken, leaving the population without resources to build wealth. Violence against Indigenous groups was so widespread it’s no exaggeration to call it genocide.
The story of Black America began with 246 years of chattel slavery, from the first slaves arriving in 1619 to the passage of the 13th Amendment in 1865. The Jim Crow era followed, with roughly 100 years of explicitly discriminatory policies against Blacks. Even Black communities that became self-sufficient and wealthy were destroyed by a white mob.
The Jim Crow system was dismantled by Civil Rights legislation in the 1960s, but discrimination remained. On the day he was assassinated, Martin Luther King, Jr., was in Memphis to energize sanitation workers who’d gone on strike. He knew the fight for racial equality was inextricably tied to housing, education, criminal justice, healthcare, and especially issues of labor and employment.
Today, the U.S. and countries worldwide are waking up to something Black Americans already know: In the pursuit of the American dream, people of color face hurdles unimaginable to their white counterparts.
Complex socioeconomic factors drive today’s employment disparities
Inequalities in childhood
Being Black or brown in America means you’re more likely to grow up in poverty, striking a lasting blow to your career opportunities and ability to build wealth.
Nationally, Hispanic/Latino and Black children are more than twice as likely to be impoverished as their white counterparts, while nearly 34% of Native American children live in poverty, according to a report by Child Trends. Some kids prove resilient, but most experience a cascading effect. Childhood poverty is associated with mistreatment, trauma, hardship and increased risky behaviors, such as involvement in crime.
Inequalities in health
Poverty is intertwined with health. Black children are twice as likely to have asthma, 10 times more likely to die of complications from asthma and have significantly higher obesity rates. This disparity continues into adulthood, and makes it harder to hold down a job. Poor health is associated with an increased risk of job loss or unemployment.
This partly explains the employment gap between Blacks and whites. Even at unemployment’s lowest point for Blacks in recent times (5.4% in August 2019), the Black unemployment rate is still higher than the white unemployment rate of 3.4%.
Inequalities in education
People who grow up poor are less likely to achieve important adult milestones like graduating high school and enrolling in and completing college.
Among those in the workforce, Asian Americans (63%) are most likely to have a bachelor’s degree or higher. Whites (41%) come in second place, followed by Blacks (31%) and Hispanics/Latinos (21%).
The education gap results in Asian Americans and whites landing more skilled and more prestigious occupations. For instance, Black and Hispanic/Latino workers are disproportionately represented in service sector positions, whereas a greater portion of Asian Americans and white workers find their way to management and professional positions. The annual average wage of management positions is $122,480, compared to $49,880 for protective services and $31,260 for personal care services.
While there’s no silver bullet, education is a primary route of entry into the managerial elite. But as you’ll see in the next section, access to stable housing plays an important supporting role, as well.
Inequalities in housing
Housing instability can lead to job loss and employment insecurity, creating extra stress and complications in seeking and maintaining employment. Low-income working renters who experienced a forced move by eviction, landlord foreclosure or housing condemnation were 11-22% more likely to get laid off, Oxford researchers found.
Housing insecurity often starts in childhood, and can leave a mark. Children who have lived in temporary accommodations for over a year are more likely to have mental health problems, and families in poverty are more likely to say housing costs cause stress and depression in their family. Blacks also account for 40% of all people experiencing homelessness.
Due to redlining and other housing discrimination, people of color have lagged in homeownership and other indicators of success in post-World War II America. Fewer Black Americans own homes than white Americans. Often, these homes are in areas with property values that are roughly half those of predominantly white neighborhoods.
Such housing discrimination continues to this day. Nearly half (45%) of Blacks in America report being discriminated against when trying to rent or buy a home, compared to 31% of Latinos, 25% of Asian Americans, 17% of Native Americans and 5% of white Americans.
Systemic racism in criminal justice undermines employment opportunities
Ninety-six percent of employers conduct background screenings. Approximately 77 million Americans — or one in three adults — have a criminal record. This creates employment problems for many people with a conviction on their record but people of color are much more likely to be negatively impacted.
Job candidates with a criminal record are at best half as likely to get a call back than applicants who don’t have one. “Even fairly minor felony records,” a 2017 study revealed, “have largely negative effects on employer callbacks.” This leads to an unemployment rate for the formerly incarcerated that’s at least triple that of the general population.
This has been compounded by politicians pursuing aggressive law enforcement strategies against drug crimes. From 1980 to 2010, this had a bigger impact on poor Blacks and Hispanics/Latinos than it did on their white peers, creating hurdles to finding jobs, renting apartments and voting. Although Black people are no more likely to use or sell drugs than people of other races, they were more likely to be arrested for those crimes, and given longer prison sentences. This happened, in part, due to “broken windows” policies that argued policing low-level offenses can prevent more serious crime.
Felony convictions for Blacks increased more than fivefold during those decades, and threefold for other felons, a University of Georgia study found. In 2017, Black adults accounted for 33% of the sentenced prison population while whites accounted for 30% of inmates and Hispanics/Latinos 23%. Stats were not available for Asian Americans.
The racial disparity in the prison population doesn’t necessarily mean minorities commit more crime. Drug laws, for example, are notoriously biased. “Black people are 3.64 times more likely than white people to be arrested for marijuana possession, notwithstanding comparable usage rates,” a 2020 analysis by the American Civil Liberties Union stated.
When companies run background checks, they may not be aware of the historical basis of criminal records, and some companies simply won’t hire you if you have one. Fifteen percent of managers said they would be unwilling to work with someone who had a criminal record, according to a Society for Human Resource Management survey. There are no federal laws barring employers from not hiring on the basis of a criminal record.
To reverse this trend, activists are pushing “Ban the Box” legislation to make it illegal for employers to ask about your criminal record on a job application. As of July 2020, thirty-five states, plus Washington D.C., and more than 150 cities and counties have stopped public sector employers from asking such questions until after the job interview. Thirteen states and 18 cities have extended the law to private employers.
These factors ultimately lead to deeply entrenched wealth and income disparities
How does one find and maintain employment when the odds are stacked against them in education, housing, criminal justice and nearly every other facet of life?
It’s possible, but it’s hard.
Blacks made serious gains after the Great Recession, leading to their best economic circumstances in recent memory. The progress, however, was obliterated overnight by the coronavirus, proving once again how fragile gains are when you’re at the bottom of the economic food chain. The Black unemployment rate is improving — 14.6% in July down from 15.4% in June — but much slower than the rate for whites (9.2%).
Meanwhile, the further you climb the corporate ladder, the less diversity you’ll find. Despite reams of research revealing that having diverse leadership teams bolsters the bottom line, even companies vocal in their support of Black Lives Matter aren’t diverse. Take Hollywood, for example, where the upper echelons are predominantly white and male.
Such disparity makes the possibility of closing the wealth gap anytime soon extremely unlikely. At the moment, Black families have a median net worth ($17,600) one-tenth that of white families ($171,000). Hispanic/Latino families and multi-race families also lag far behind (at $20,720 and $64,620, respectively).
White dominance in white-collar and c-suite positions hinders Black success
A solid financial future for people of color is thwarted by the lack of diversity at the top ranks in every sector of the U.S. economy. Nearly 90% of chief executives are white, and they’re overrepresented in high-paying professional occupations in medicine, architecture and management.
Reducing employment disparity will require both economic and cultural transformation. Even Blacks who “make it” in today’s economy feel the weight of their skin color.
“When it comes to improving education, improving healthcare, we seldom look at the overarching environment in which the institutions reside,” Brookings Institute fellow Andre Perry, says. “Right now we have too many systems that are built on privileging whiteness at the expense of everyone else.”