Occupational Discrimination?

Former president Harry Truman classified the march for civil rights as “silly,” thinking that the protest would not achieve anything. Almost a half century later, American financial markets are closed in commemoration of Martin Luther King, and the planet’s greatest power has had a black president for the last three years. However, in the labor market, clear discrimination against the African-American community continues.

This discrimination is evidenced by the statistics; the latest employment figures published two weeks ago in the U.S. clearly reveal that the black community is not benefiting from the recovery in hiring as is the white community. Meanwhile, the unemployment rate remained stable during the last year at 15.8 percent, while the overall unemployment level decreased to 8.5 percent and to 7.5 percent for whites.

Whiter equals higher wages. Yet before the eruption of the crisis, black employees earned a median of 71 percent less than whites. Their participation in the labor market is concentrated in the worst-paying occupations (salaries less than $30,000 per year), with a minimal representation in the best remunerated positions (over $50,000).

In 2008, the median wage that a black employee received was $14.90 per hour, as opposed to $20.84 for a white employee. The basis of this disparity could be due to the level of education and the area of studies chosen in order to advance in the labor market. But they are factors that do not explain the entirety of this discrimination, as shown in various reports from the Economic Policy Institute.

LINK FOR IMAGE REFERENCED BELOW

Algernon Austin, director of the Program on Race, Ethnicity, and the Economy at the Economic Policy Institute says bluntly, “At the end of the day, it turns out that being black matters,” upon explaining this labor “segregation.” It is specifically in this sense, he says, that 90 percent of the workers in the U.S. can be categorized as “racially segregated”; he points out that blacks are overrepresented in poorly-paid service sector jobs.

There are more examples of this occupational discrimination. It is confirmed upon examining the positions that representation is very low in management posts in large firms. The latest list of the largest 500 U.S. companies produced by Fortune Magazine shows that, for example, the number of black executives of these large corporations does not even reach 10.

Franklin Raines was the first in forming a part of this exclusive club upon being placed at the head of the mortgage lender Fannie Mae. That was in 1999. A decade later, Ursula Burns at Xerox joined him as the first black woman managing a Fortune 500 company. The EPI shows that it is not the black workers that are deciding to go into these lowest-paid occupations or positions.

LINK TO IMAGE REFERENCED BELOW

In fact, upon comparing the college majors chosen by blacks and whites, it is confirmed that there are no major differences. It is evident that factors cannot be isolated to explain this discrimination. And what is also evident, as shown by the curve of the above graph, is that there is a narrow relationship between black children’s poverty rates and unemployment.

Blacks today are twice as likely to be out of work as whites. And if education is a factor when it comes to determining the salary and position that one obtains in the labor market, it is evident that reducing unemployment is a vital condition in confronting the problem of poverty. “Fewer black children in poverty set the stage for higher black student achievement.”