Why the economic recovery looks different for women of color
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Employment prospects improved in December for every race and gender group except Black women.
Though the unemployment rate dropped to 3.9% overall, for Black women that number increased from 4.9% to 6.2%, revealing an uneven recovery from the COVID-19 downturn.
Michelle Holder is president and CEO of the Washington Center for Equitable Growth and a longtime scholar of the unique position of women of color in the American labor force. She spoke with “Marketplace” host Kai Ryssdal about why women of color were particularly vulnerable to the pandemic’s economic impact.
The following is an edited transcript of their conversation.
Kai Ryssdal: So, the jobs report comes out last Friday, hot off the presses at 8:30. What did you think when you scrolled down to the part where it gets broken up by race and gender?
Michelle Holder: Yeah. So you know, one of the things that have been pretty clear over the course of this COVID pandemic is that the participation rate of Black women in the U.S. labor force has been on the steepest decline, with the exception of Latinas, the biggest drop in the labor force participation rate among female demographic groups is among Latinas and then, secondly, Black women. But the magnitude of those declines is really quite telling.
Ryssdal: Talk to me a little bit about why it’s happening.
Holder: So you know, in looking at Black women, part of the story there is like all women in the U.S., they are overrepresented in the service sector. But you know, they are also particularly overrepresented in the care industry. The most likely jobs to be lost during the first several months of the COVID downturn were cashiers first and then, secondly, child care workers. So this is one of the things that really played into the steep decline in Black women’s labor force participation rate — their overrepresentation in the care industry in the U.S.
Ryssdal: OK, so now move from the kinds of jobs that Black women do in this economy to the position Black women hold in the American labor force, because they are unique, right, both in their status in households and in how they bring home the wages in those households?
Holder: One thing I would definitely want to sort of preface this discussion by saying is that Black women are actually the most attached to the labor force, more so than white women, more so than Latinas. There are reasons for that. One major one is that after emancipation, Black men’s wages were so little that it was actually necessary for Black women to work. But, you know, fast-forward to the present day, the position of Black women in the workforce, it’s determined by several things. No. 1, a really pivotal moment in the history of the United States was the Civil Rights Act. Prior to that, there were occupations and industries that Black women were actively excluded from. That period kind of cast a shadow on where Black women would be situated in the workforce in this country for decades to come.
Ryssdal: So what does it mean now, decades later, as we sit here, looking at a December 2021 unemployment report, and the unemployment rate for Black women goes up by something like a percent and a half as the overall rate goes down. And everybody says, “Oh look, full employment practically.” What does that mean for the broader economy?
Holder: Well, it doesn’t mean anything good. If you look carefully at the numbers, what effectively happened is Black women started reengaging more so in terms of looking for work but could not find work. And furthermore, you know, even though their labor force participation rate, along with basically every other demographic group, increased slightly, we’re on a downward trajectory in terms of attachment to the American labor force, which is really not good for our economy at all.
Ryssdal: So as we enter year three of this pandemic, with all of the historical situations that you have cited and a future as uncertain in this economy as it’s been in many a decade, where are we going, do you think? What’s your guess?
Holder: Yeah, of course, as an economist, I always try to avoid sort of predicting what’s going to happen. We’re frequently wrong. But one of the things that I think, unfortunately, we’re going to see is more precarity with regard to Black and brown women as workers. If an employer is comparing resumes, and for Black and brown women you’re seeing longer stints of unemployment, this has what economists like to call a “scarring effect” on groups going forward. There are going to be lingering scarring effects, more so for Black and brown women.
Ryssdal: You know, that’s so funny because [Federal Reserve Chair] Jay Powell early on in this pandemic, he would talk about the scarring effects of this pandemic on the labor force. And here you are now, saying it’s gonna be worse actually than we thought.
Holder: Well, it’s gonna be worse for women of color.
Holder: Yeah, that’s the key. That’s the key.
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