The Economic Policy Institute has released a new report stating that black unemployment is rising during an economic recovery.
The first chart shows the change in unemployment rates by race and gender over two time periods: the first 13 quarters of this recovery and the same time period over the early 1990s recovery. While the overall rate (i.e., the rate for all jobseekers) and the white rate specifically both fell by 0.4 percentage points in the first three years of the early 1990s recovery, the rate fell slightly faster, by 0.6 points, for African Americans. This relationship is the long-held historical pattern for minorities, as their employment opportunities tend be more responsive than whites to changes in economic conditions (e.g., minority unemployment rates tend to worsen faster in a downturn and improve more quickly in an expansion, where as white rates tend to be more stable).
Surprisingly, in this recovery, the opposite pattern has prevailed thus far. The overall rate is down slightly, as is the white rate. But the unemployment rate for African Americans is up by 0.8 percentage points overall, driven by the 1.4 point increase for African American men. By the first quarter of 2005, the overall African American unemployment rate was 10.6%, while the overall rate--5.3%--was half that level.
Blacks are doing worse in an economic recovery and so they will do even worse in the next economic downturn.
But conspicuous differences are apparent between the last two business cycles. In the early 1990s, the overall employment rate began to climb by around the 10th quarter, and the African American rate follows the overall rate fairly closely. In the current case, however, employment rates have yet to trend up very convincingly, and African American rates actually have continued to fall. Almost four years after the recession began in March 2001, employment rates remain down by 2 percentage points overall and almost twice that much (3.7 points) for African Americans.
The Economic Policy Institute's writers list a few unlikely causes for this phenomenon including racism. Meanwhile they predictably miss the elephant in the room: Massive amounts of Hispanic immigration. Edward Rubinstein points out why the EPI is wrong.
But if racial discrimination is such a factor, why has Hispanic job growth outpaced that of whites? (For example, Hispanics got 60 percent of the new jobs created in March; in the entire Bush II era Hispanic employment has grown 14.3 percent vs. just 0.3 percent for non-Hispanic employment growth).
In fact, discrimination is the best explanation for persistent Black unemployment - but not the sort of discrimination EPI has in mind.
Arguably the most racist policy in this country for the past quarter century has been immigration policy. The onslaught of poorly educated, mainly Hispanic immigrants has stymied good faith efforts of African Americans to climb up the economic ladder.
Blacks overwhelmingly vote for the Democrats while the Democrats strongly support massive Hispanic immigration that harms blacks economically. The Democrats correctly perceive Hispanics as mostly expanding the lower class and therefore see most Hispanics as future Democrats. The Democrats are willing to sacrifice black interests in order to ensure future Democratic Party majorities. Therefore the Democrats care far more about winning elections than helping the poor people we already have. (and I'm not saying the Republicans are ethically any better)
A new study from the Pew Hispanic Center reports that Hispanic salaries have fallen for the last 2 years in a row.
Washington, DC - Hispanic workers accounted for more than 1 million of the 2.5 million new jobs created by the U.S. economy in 2004. But Hispanics are the only major group of workers to have suffered a two-year decline in wages and they now earn 5 percent less than two years ago, according to a Pew Hispanic Center analysis of latest data from the Bureau of Labor Statistics and the Census Bureau. The report is available on the Center's website: www.pewhispanic.org.
Recently arrived Hispanic immigrants were a leading source of new workers to the economy but also among the principal recipients of wage cuts in 2004.
"Despite strong demand for immigrant workers, their growing supply and concentration in certain occupations suggests that the newest arrivals are competing with each other in the labor market to their own detriment," said the report's author, Rakesh Kochhar, a senior research associate at the Center.
The vast majority of new jobs for Hispanic workers were in relatively low-skill occupations calling for little other than a high school education. In contrast, non-Hispanic workers secured large increases in employment in higher-skill occupations requiring at least some college education.
The Hispanic wage decline is accelerating and only Asians are experiencing a wage gain.
• Real weekly earnings for Hispanics declined by 2.2 percent in 2003 and by another 2.6 percent in 2004. Latinos are the only major group of workers whose wages have fallen for two consecutive years.
• Meanwhile, wages of non-Hispanic white and black workers increased in 2003 but declined by 1.8 percent and 1 percent respectively in 2004. Asian workers are the only group to have increased their earnings each of the past two years.
• Recently arrived Latino immigrants saw their wages fall by 2.6 percent in 2004. This was matched by recently arrived non-Hispanic immigrants whose earnings fell by the same amount in 2004.
Edward Rubinstein again says basic economics explains why wages are falling.
The author of the Pew study professes "surprise" that Hispanic wages would fall at a time when they are having such "luck" in getting jobs.
A refresher course in Economics 101 is in order here.
Falling prices denote a surplus. That is a basic principle of economics. Falling Hispanic wages are thus a signal sent by a labor market that is saying what many of us have been saying for years: Immigrant workers are simply not needed. Far from doing the jobs that Americans "won't do," Hispanic immigrants are displacing low wage natives—Hispanic and non-Hispanic alike.
Immigration is growing the size of America's lower class. Why do that? This harms the interests of the vast majority of the American people. More people can not afford to pay for their own medical care. More people do not pay enough taxes to fund the education of their children. More people are criminals. The list of harmful consequences is long. We should stop the illegal influx, deport all the illegals who are here, and raise the standards on who can immigrate legally. We do not need more poorly educated and low skilled workers.
|Share |||By Randall Parker at 2005 May 09 12:18 PM Immigration Economics|