washingtonpost.com > Business > Local Business

U.S. unemployment rate for blacks projected to hit 25-year high

By V. Dion Haynes
Washington Post Staff Writer
Friday, January 15, 2010

Unemployment for African Americans is projected to reach a 25-year high this year, according to a study released Thursday by an economic think tank, with the national rate soaring to 17.2 percent and the rates in five states exceeding 20 percent.

Blacks as well as Latinos were far behind whites in employment levels even when the economy was booming. But throughout the recession, the unemployment rate has grown much faster for African Americans and Latinos than for whites, according to the study by the Economic Policy Institute. Moreover, the unemployment gap between men and women has reached a record high -- with men far outpacing women in joblessness.

The national trend is playing out in the Washington area, even though jobless levels are lower here.

In the District, researchers say, the unemployment rate during the third quarter of this year is expected to reach 6.1 percent for whites and 18.9 percent for blacks. Unemployment in Maryland is forecast to reach 6.1 percent for whites and 11.3 percent for blacks. And in Virginia, 6.3 percent of whites are projected to be out of work, compared with 13 percent of blacks.

The rate for Latinos in Maryland is expected to reach 7.6 percent. Researchers did not include data on Hispanics in the District and Virginia because the samples were too small.

Blacks, Hispanics and men have suffered the most mainly because they have been disproportionately employed in sectors hardest hit in the recession -- manufacturing and construction. For instance, the unemployment rate for blacks is expected to reach 27 percent in Michigan, which has been shedding auto industry jobs. Other states with jobless rates above 20 percent for blacks are Alabama, Illinois, Ohio and South Carolina.

The rate for Hispanics is projected to reach 22.2 percent in Nevada, which has experienced a dramatic slowdown in construction.

The results demonstrate that the Obama administration needs to do more to target groups with high unemployment rates, experts say. The Congressional Black Caucus wants the government to create training programs and jobs in low-income communities with the highest unemployment rates.

"It's like triage in an emergency room -- you take care of people who need the most help first and you help the others later," said Kai Filion, research analyst at the Economic Policy Institute. He said that the economic losses could result in a 50 percent poverty rate for black children, up from 34 percent in 2008.

The economic devastation for blacks and Hispanics is underscored in another study issued this week by a Boston-based nonprofit research organization called United for a Fair Economy. "State of the Dream," its annual report issued in connection with the Rev. Martin Luther King Jr.'s birthday, asserted that blacks and Hispanics are three times as likely to be poor as whites; that blacks earn 62 cents for every dollar whites earn; and that the family median net worth of whites in 2007 was $170,400, compared with $27,800 for blacks and Hispanics.

"We have a long history of discriminatory policies and practices, including outright segregation, redlining, misguided urban renewal plans and predatory lending, that have prevented people of color from building up personal wealth," said Brian Miller, executive director of United for a Fair Economy and co-author of the report.

According to the Economic Policy Institute report, the unemployment rate for blacks is projected to reach a not-seasonally adjusted rate of 17.2 percent in the third quarter of this year, up from 15.5 percent during the same period last year. And the rate for Hispanics is forecast to jump to 13.9 percent from 12.4 percent. The study is based on Bureau of Labor Statistics data and projections from Moody's Economy.com.

Researchers say the unemployment rate for whites will rise 5 percentage points from the beginning of the recession in December 2007 to the third quarter of 2010. But during that same period, they say, it will climb 8.6 points for blacks and 7.9 points for Hispanics.

© 2010 The Washington Post Company