Lower average unemployment would substantially reduce the Black–white annual earnings gap: Ratio of Black to white annual median earnings in 1970 and 2019 (actual and under three counterfactual scenarios based on lower unemployment)
| Black-white ratio | |
|---|---|
| 1970 | 62.4% |
| 2019, actual | 80.0% |
| 1.0 ppt. lower | 90.1% |
| 1.5 ppt. lower | 95.6% |
| 2.0 ppt. lower | 101.4% |
Notes: Annual earnings measure excludes workers who earned zero dollars in the year. Regression coefficients from Figure B are used to construct counterfactual wage and earnings growth based on lower unemployment, and the annual median earnings of Black workers are compared with the annual median earnings of white workers to estimate the gaps.
Source: Author’s analysis based on data from Flood et al. 2021 and the Bureau of Labor Statistics (BLS-CPI 2021).