“When the economy bounces back,” she said, “we know that it’s not going to bounce back as quickly for black workers.”
The composition of the labor market also leaves black workers at heightened risk of long-term unemployment compared to white workers. Workers of color are more heavily represented in jobs with higher risk of coronavirus exposure — customer service, food service and security, for example — which were hit first and hardest and are likely to be among the last to come back, according to a new analysis led by PolicyLink and funded by JPMorgan Chase.
Some of those concerns may have already begun to play out. The May jobs report showed an unexpected drop in the overall unemployment rate as the economy gained jobs in industries like hospitality and construction. But jobs in local government, where black workers are heavily employed, continued to drop sharply.
As a result, the white unemployment rate dropped nearly 2 percentage points — while the black unemployment rate rose 0.1 percentage point.
In other areas, too, black workers and families are bearing the brunt of the deep recession being felt across the country. More than 55 percent of black households report having lost employment income since mid-March, according to a Census survey released this week, as compared to 43 percent of white households.
And any signs of recovery could be just as uneven: More than 2 in 5 black households expect to continue losing income over the next month, the survey showed, while just over a quarter of white households reported the same.
“So you can imagine the financial strain that a lot of these families are under,” said Connor Maxwell, a senior policy analyst at the left-leaning Center for American Progress. “Even if they’re able to get jobs after this recovery, are they going to be able to bounce back economically the same way as a lawyer who has been working remotely for the past three months?”
Economists and analysts are increasingly calling on Congress to step in to boost recovery efforts, allocate more aid and ensure the funding that is available is being distributed evenly.
The Paycheck Protection Program, in its initial iteration, offered an early warning sign of how hundreds of billions in government-backed loans allocated to support small businesses could be less accessible for those with black owners, in part because they are less likely to have had relationships with major banks.
As a result, a Goldman Sachs survey from late April found only 79 percent of black business owners had applied for a PPP loan versus 91 percent overall. And those who did apply had more trouble earning approval: Only 2 in 5 black applicants were approved, Goldman found, compared to 52 percent of business owners overall.
In the same way that black Americans lost their homes at far higher rates than their white counterparts during the Great Recession — a factor that contributed to the uneven recovery — there’s concern that black business owners could now be more at risk of losing their livelihoods.