Wonkblog | Analysis
September 15, 2017 at 8:28 AM
African Americans were worse off financially in 2016 than they were in 2000.
The median income for an African American household was $39,490 last year, according to U.S. Census Bureau data released this week. It was $41,363 in 2000. (Both figures are in 2016 dollars, so they have been adjusted for inflation).
African Americans are the only racial group the Census Bureau identifies that has been left behind. White, Asian and Hispanic households have all seen at least modest income gains since 2000.
The uptick in incomes for so many Americans helped lift the overall median U.S. household income to $59,039 last year, the highest level ever recorded by the Census Bureau. That figure surpassed the previous record set in 1999, during the last period of strong economic growth. Median household income means half of U.S. households earn more and half earn less. It's an important indicator of the health of the middle class.
But the overall trend masks the fact that African Americans, as a group, have not recovered.
Black Americans have struggled for years to move up the economic ladder. They have a harder time finding jobs. Merely having an "African American sounding name" makes an employer less likely to hire someone, a National Bureau of Economic Research study found.
The black unemployment rate is nearly double the white unemployment rate. It's been that way since the Labor Department began keeping track of unemployment by race in the early 1970s. Black Americans also receive substantially lower wages than whites and Asians.
"Character, talent and insight are evident in individuals from all income classes. But not all individuals get an equal chance to prove their mettle," said Mary Coleman, senior vice president of Economic Mobility Pathways, a Boston-based nonprofit group.
The Census data also showed that almost 1 in 4 black households lives in poverty. The poverty rate among African Americans (22 percent) is more than double the poverty rate among whites (9 percent).
African Americans have the lowest earnings of any racial group by far. While median household income for African Americans was just over $39,000 last year, it was over $47,000 for Hispanics, over $65,000 for whites and over $81,000 for Asian American households.
Lower incomes make it harder to get by, let alone get ahead. African Americans are much less likely than whites to own homes or invest in the stock market, in part because low wages leave them with limited extra income to save up for a down payment.
African Americans also are more likely to lack health insurance. The Census released data this week showing that the uninsured rate for the nation overall was 8.8 percent, an all-time low. But it was 10.5 percent for African Americans.
Many books and research papers have delved into why African Americans continue to struggle financially. Williams Rodgers, chief economist at the Heldrich Center for Workforce Development at Rutgers University, is one of the scholars who has studied the issue extensively. He co-authored a report last year for the left-leaning Economic Policy Institute that found that black-white wage gaps are larger today than they were in 1979.
The study noted that even when African Americans attend college and actively work to expand their skills and networks, they still earn far less than whites with similar educational background. In fact, the wage gap has expanded the most between college educated blacks and whites.
His conclusion after years of looking at the data and trends? "Wage gaps are growing primarily because of discrimination," said Rodgers.
The small silver lining in the latest census data is that African American incomes grew nearly 6 percent last year, the most of any racial group, but it's not moving quickly enough to do much to close the vast income gap between African Americans and other groups.