As the U.S. economy has picked up again after the recession, it's become clear that some Americans are getting a bigger share of the recovery than others.
A new report released Monday by the Working Families Project, a national initiative that pushes state governments to adopt family friendly policies, shows that black and Hispanic working families are twice as likely as those headed by whites and Asians to be poor or low-income—a gap that has widened since the recession.
The report said that the growing racial inequality raises urgent questions about the nation’s economic future, as black and Hispanic families are becoming an ever larger part of the national fabric. The report said the number of minority workers in the labor force is projected to increase sharply by 2022, while the number of white workers is decreasing.
If current trends hold, too many minority workers will not be “prepared for their roles,” the study said. And researchers argue the government should do more.State lawmakers should push for policies such as increasing the minimum wage, expanding financial aid for college, and expanding Medicaid, and expanding refundable tax credits for working families to close the gap.
“This is a moral as well as economic issue that’s defining the fairness of our society,” said Brandon Roberts, a co-author of the report. “The inequality between hard-working families in America is very real and must be addressed.”
Overall, nearly one-third of all working families are either in poverty or earn no more than twice the poverty rate, which is $40,180 a year for a family of three. But 55 percent of Hispanic families and 49 percent of black families fall into that category, in part because they have lower levels of educational attainment than whites and Asians, who have just under one in four working families that are low-income.
The report said that nearly half of all low-income working families—and nearly three out of four low-income black working families—are headed by single parents. Also, more than half of low-income Hispanic families had at least one parent who did not complete high school. By contrast, just 16 percent of white workers were high school dropouts.
Still, educational differences explain just part of the income gap, as white workers tend to earn higher wages than blacks and Hispanics at every educational level. The report, which is based on Census statistics, found that the median earnings for white high school dropouts working full time was $31,606—which was higher than the $31,061 earned by black high school graduates in full-time jobs.
The report, which was funded by the Annie E. Casey, Ford, Kresge and Joyce foundations, found that low-income black and Hispanic workers tend to be concentrated in low-paying professions such as food preparation, retail sales, health care aides and housekeeping. Changing that, the report emphasized, is crucial to the nation’s future.
“In little more than a generation, racial/ethnic minorities will make up the majority of the U.S. population and labor force,” the report said. “Minority workers will play a critical role in keeping Social Security and Medicare solvent. But if current levels of inequality persist, younger workers and their families will not be able to move into the middle class, which will significantly impact the well being of our country.”