Since the second Trump administration swept into office in January 2025, it has undertaken a range of damaging and destabilizing actions that have weakened the economy, undermined workers, hurt businesses and consumers, and threatened core elements of our democracy. While Trump has targeted numerous Democratic-led states and cities, the Washington, D.C., region has faced acute and prolonged harms since day one. From the first set of executive actions signed on Inauguration Day, the Trump administration has attacked people and businesses in the capital region repeatedly and intensely. These initial actions announced the president’s dubious claims of authority to fire large segments of the federal workforce, eliminate long-standing federal agencies and programs, and begin a campaign of illegal and inhumane mass deportations.  

The Trump administration’s damaging actions have been enabled and abetted by Republican members of Congress. Their passage of H.R. 1, the bill that the White House has referred to as the “One Big Beautiful Bill Act” (OBBBA), amplifies the administration’s mass deportation agenda and shreds critical health care and food supports for lower-income families to finance tax cuts for the wealthy. This funding bill will only cause more pain in the years ahead for Washington, D.C.-area households and throughout the country.

Congress also passed a federal spending bill that constrained the District of Columbia’s ability to spend its own tax revenue (Koma 2025) and a resolution that may force the district to adopt local tax code changes that match the OBBBA, whether the city wants to or not—changes that will jeopardize hundreds of millions of dollars for city programs (D.C. Fiscal Policy Institute 2026).

In this report, we assess the early indicators of the damage of Trump’s actions and their effects on the Washington, D.C., regional economy, with particular attention to effects on workers and the labor market. We focus on this region due to its prominence as an early target of the Trump administration, in part due to its large federal workforce. Additionally, the district’s unique status as a non-state means that its leaders have far less legal authority to resist Trump’s interference than other target areas do.

Throughout this report, unless otherwise indicated, the data describe economic conditions for the Washington, D.C., metropolitan statistical area (MSA), which includes the District of Columbia, four nearby counties in Maryland, six cities and 11 counties in northern Virginia, and one county in West Virginia. We also refer to this region as the DMV (Washington, D.C.; Maryland; and Virginia). While we do not yet have the requisite data to fully and precisely document all the effects of the administration’s actions, we can see clear signals that the regional economy is already struggling, with more severe impacts likely to register in the data soon.

We then explore some of the factors that make other regions particularly vulnerable to significant economic harm from the Trump administration’s agenda. These include counties with large concentrations of federal workers, areas where federal transfer income (such as Medicaid and Social Security) makes up a significant portion of the region’s economic base, and places with significant immigrant populations. Though Trump has largely targeted prominent, Democratic-led areas, many of the regions most susceptible to the harmful economic consequences of the administration’s actions are rural counties, frequently represented in Congress by Republicans.

Trump’s actions in Washington, D.C., have led to reduced employment and rising unemployment

The clearest sign of the harm that the Trump administration’s actions have done to the Washington, D.C., regional economy is the substantial drop in the region’s employment rate. Based on EPI analysis of Current Population Survey data from the Bureau of Labor Statistics, from December 2024 to December 2025, the share of the regional working-age population with a job fell by 3.2 percentage points.1 As shown in Table 1, this compares with a decline of just 0.4 percentage points for the country over the same period. Among prime-age workers (those ages 25–54), the share employed in the DMV fell by 2.7 percentage points, compared with a decline of just 0.1 percentage points for the country overall.

This dramatic drop in regional employment is a direct result of the Trump administration’s relentless attacks on federal government workers, cuts to federal programs and agencies, and their cascading effects on connected regional industries. Prior to Trump’s taking office, federal employees made up 11.2% of the metro area’s total workforce (BLS-CES-SAE 2025).2 Between the end of 2024 and 2025, federal employment in the DMV region fell by more than 53,800 jobs (-14.2%) (BLS-CES-SAE 2026).3 These losses reverberated through the regional economy as affected households pulled back on spending, and many may have even opted to move, as data show the DMV region had the largest increase in home sale listings of any major metro last year (Brookings Institution 2026).

These significant cuts to federal employment, though highly damaging on their own, are only the first layer of the administration’s harm on the regional labor market. The DMV has a non-federal workforce of over three million people (BLS-CES-SAE 2026), many of whom work at firms that consult with, contract with, are funded by, or are otherwise connected to the government.4 The Trump administration has terminated thousands of grants to scientific research institutions (Kozlov, Tollefson, and Garisto 2026) and frozen or delayed funding for tens of thousands of nonprofit organizations, causing those targeted to limit operations or lay off staff (Tomasko et al. 2025). These cuts have also shrunk the funding pool for nonprofit groups, causing budget challenges even for those not previously receiving federal funding, as they must compete with groups previously funded through federal programs that are now scrambling to fill gaps with private support (Barrett 2025). The administration has also moved to cancel contracts with any company that maintains a commitment to DEI standards (Singh 2026). Although these cuts affect organizations everywhere, the DMV is disproportionately vulnerable to the economic harms of attacks on this sector as it has one of the highest concentrations of nonprofits in the country (Friesenhahn 2025). This is evident in the region’s slight dip (-0.3%) in private-sector employment from December 2024 to December 2025, a change from the consistent, albeit slowing, growth that had marked the years following the COVID-19 pandemic. At the national level, private-sector employment experienced slow but still positive change (0.5%) over the same period (BLS-CES-SAE 2026).5

The widespread impact of the administration’s actions can be seen in the breadth of employment declines across racial, ethnic, gender, and age groups in the region. As shown in Table 1, the employment rate fell by at least 2 percentage points for every demographic category of workers in the DMV. Notably, young workers under age 25 (-4.3 percentage points), workers age 55 and older (-3.3 percentage points), men (-3.5 percentage points), and Black workers (-5.9 percentage points) all experienced drops in their employment rates larger than the regional average. For older workers, the above-average decline likely reflects, at least in part, the firings and retirements of many federal employees, including many who had been near retirement age and opted into the so-called “Fork in the Road” deferred resignation program. For young workers, the administration’s funding and programmatic cuts directly reduced many traditional Beltway early-career opportunities (internships, fellowships), while weakness in the broader regional economy simultaneously forced area employers to pull back on entry-level positions.

Still, not all groups have been equally affected by Trump’s actions. As Table 1 shows, Black workers in the DMV region have suffered the largest employment declines, with the share employed falling by 5.9 percentage points in 2025. This is nearly triple the employment drop experienced by white workers (2.0 percentage points) in the region and, notably, more than seven times the employment drop of Black workers throughout the country overall (0.8 percentage points). Again, this is a direct consequence of the administration’s attacks on the federal workforce. Black workers have long tended to make up a larger share of the public sector than they do in the private sector—both in the DMV and across the country. This is because the public sector has historically been a pathway to the middle class for workers of color who face labor market discrimination in the private sector (Maye and Marvin 2025).

Trump’s massive cuts to federal employment have also rapidly undone what had been considerable progress in shrinking the regional Black-white employment gap. Figure A shows the employment rate of DMV workers, overall and by race/ethnicity, since the end of 2018. The rapid drop in the Black employment rate since the start of President Trump’s second term is striking, bringing the regional Black employment rate back down to its pandemic-era low. It is also notable that before that drop began, Black workers in the region were employed at essentially the same rate as their white counterparts—the only time in the last two decades when that occurred. These losses in employment will exacerbate existing racial and gender inequity across wages, poverty, and unemployment (Markoff and Zielinski 2026; Zielinski 2025; Busette and Elizondo 2022).

Recent increases in the DMV’s overall unemployment rate underscore the damage Trump is doing to the region. The non-seasonally adjusted unemployment rate jumped more than a full percentage point, from 3.1% in January 2025 to 4.4% in January 2026—more than four times the increase in the national figure. (Importantly, this increase understates the weakening of the area labor market, as the BLS estimates the DMV labor force shrank by 3% over the same period—meaning that many workers who would have been counted as unemployed simply left the area labor force.) For comparison, the national non-seasonally adjusted unemployment rate increased by less than half a percentage point, moving from 4.4% in January 2025 to 4.7% in January 2026 (BLS-LAUS 2026).

These numbers do not capture the full extent of the economic downturn in the DMV area, nor can they give us precise insight into where the pain has been most acutely felt. The administration’s violent deportation agenda, for example, will lead to a drop in immigrant and U.S.-born Hispanic workers’ employment, but resulting changes in Hispanic employment rates may be muted by the corresponding shrinking of the overall Hispanic population (Zipperer 2025). In other words, while the overall Hispanic population in the U.S. may fall dramatically in coming years, the ratio of remaining employed workers to remaining total population may stay somewhat consistent. This will mask the true scale of the economic and social harm being done to immigrant communities in the DMV and across the country.

It is also difficult to fully quantify how the deployment and continued presence of National Guard troops, violent immigration actions, and other authoritarian, fear-inducing tactics have impacted D.C.-area businesses, workers, and families, particularly in neighborhoods with predominately Black and Latino populations. Early data show regional declines in tourism, consumer spending, and foot traffic; harder to capture are the emotional and long-term economic consequences (Montgomery 2025; Hadden Loh and Haskins 2025; Sachs and Cocco 2025). Other recent analyses estimate similar economic harms in cities where targeted federal immigration enforcement actions have been aggressively deployed (Rosenthal and Sojourner 2026). A full accounting of the Trump administration’s harms on the Washington, D.C., region will take years to document.

Other localities should brace for similar consequences

Some of the Trump administration’s actions and their acute consequences are unique to the DMV, a function of the region’s high concentration of federal employees and government contractors, as well as the District of Columbia’s lack of statehood and full constitutional rights. However, the anti-government attacks the administration has unleashed on DMV-area households, workers, and businesses will have cascading consequences for communities throughout the country. The effects of the administration’s authoritarian attacks on the civil service, democratic institutions, and immigrants (Human Rights Watch 2026) that first registered across the DMV should be viewed as a preview of the consequences that will be felt in other regions. While no locality will be spared, regions particularly at risk include those with large shares of government workers (especially federal workers, but state and local government workers too), localities in which federal funding and social safety net programs make up a large portion of total area income, and those with large immigrant populations.

Trump’s attacks on the federal workforce will harm communities that rely on their employment

The day Trump returned to power in January 2025, he began attacking the federal workforce, first by moving to reclassify tens of thousands of federal employees to make it easier to fire and replace them with political loyalists (EPI 2026c), and then by stripping more than one million federal workers of their collective bargaining rights (EPI 2025a). The Trump White House subsequently worked feverishly to slash federal employment, attempting large and chaotic reductions in force, shuttering entire agencies, and coercing tens of thousands of staff to resign, among many other attacks (Poydock 2025). As of March 2026, the administration’s actions have reduced nationwide federal government employment by over 350,000 (11.7%) since January 2025 (Gould 2026).

Though federal workers make up a sizeable share of the DMV’s workforce, over 80% of federal workers live outside the region (Partnership for Public Service 2024). For instance, in Alaska, Hawaii, and New Mexico—states that are home to large swaths of federal and Native land, military bases, and federal research institutions—federal workers make up at least 4.5% of total employment (EPI 2025c). Within states, federal workers tend to be concentrated in specific localities. For instance, in Apache County, Arizona, which is largely made up of the Navajo Nation and the White Mountain Apache Reservations, lands that extend beyond county lines, the federal government employs 12% of the county’s workers, more than double the next most significant county for federal worker employment in the state (EPI 2025c). There are 22 U.S. counties, spread across the South, Midwest, and West Census regions, where federal workers comprise at least 10% of the county’s workforce (see Table 2).

In these counties and elsewhere, federal workers are the backbone of the regional economy, both through the essential services they provide and through their contributions to the local economy. Trump’s attacks simultaneously threaten federal workers’ livelihoods and the economic health of communities in which these workers’ spending on goods and services makes up a large share of economic activity in the region. In Apache County, Arizona, civilian government workers’ earnings comprise 11.7% of total economic activity in the county (see Table 3)—roughly the same as their share of overall county employment. However, in some counties, federal employees’ earnings are a disproportionate share of the regional economic base. For instance, in Leavenworth County, Kansas, where federal employees make up 10.0% of employment (Leavenworth has a large federal prison), federal civilian earnings comprise 22.1% of total income in the county.

The effects from lost federal jobs and income in these regions could be devastating. Some of these communities are places that have already faced historic disinvestment and in which there are few local employment opportunities that can match the quality of federal government jobs. These jobs are historically stable, good quality, union jobs that offer a pathway to the middle class, particularly for workers without a college education.6

Regions highly dependent on federal revenue will also suffer from a reduction in services and a loss of income

Beyond the harm to localities from reductions in the federal workforce, localities that are particularly reliant on federal government revenue and services will bear the consequences of Trump’s actions most acutely, though no locality will be spared from harm. For example, the Trump administration has announced or considered $23 billion in cuts to federal clean energy projects in nearly every state (CATF 2025) and $8 billion in cuts to colleges and universities that will impact every state’s economy (Bedekovics and Ragland 2025). Trump’s 2025 budget bill also made massive cuts to federal safety net programs that millions of low-income households rely on in order to finance tax cuts for the wealthiest households and corporations.

Funds from federal programs such as SNAP, Medicaid, and other social programs not only help struggling families make ends meet, they also comprise a significant share of a locality’s “economic base,” the amount of money circulating in that region, as shown by sociologist Robert Manduca in a recent working paper (2025). Indeed, an often-overlooked benefit of Medicaid coverage is its role as a source of income for low-income households (money they would have had to spend on medical care in the absence of Medicaid). For the bottom 20% of households in the U.S., Medicaid comprised 70% of their total money income, based on recent data from the Congressional Budget Office (Bivens, Wething, and Morrissey 2025). In fact, government transfers such as Social Security, Medicare, and Medicaid collectively made up 40% of the economic base of U.S. regions in 2022 (Manduca 2025). Substantial cuts to government social programs that support low-income households could reduce the economic base of these localities, at a scale equivalent, in many cases, to the loss of entire private industries in those areas.

Without deliberate intervention by state lawmakers to offset lost federal revenues, localities in every state face dire economic losses, but states particularly reliant on government transfers will suffer most. For instance, take Clay County, West Virginia, which is represented in Congress by Rep. Carol Miller (R-WV01), who voted in support of Trump’s budget bill (Miller 2025). Clay County’s poverty rate is more than double the national rate, and its per capita income is half the national amount (U.S. Census 2024a). Of the 10 U.S. counties that rely most on each of the largest federal social insurance programs (Medicare, Medicaid, SNAP, and Social Security) as a share of their economic base, Clay is the only county in the country to show up three times (see Table 4). Federal government transfers in the form of Medicare, SNAP, and Social Security payments comprise 57% of Clay County’s economic base, 20 times the share comprised by the earnings of every private industry in the county combined. Alaska, Arizona, Florida, Georgia, Kentucky, Tennessee, and West Virginia all have at least three counties that are ranked in the top 10 in the country for their reliance on a given social safety net program as a share of the county’s economic base (see Table 4).

Localities that have significant shares of federal workers and rely heavily on federal government transfers may face particularly significant consequences as a result of Trump’s attacks on the federal workforce and the Republican budget bill’s cuts to essential social safety net programs. For example, in Rio Arriba County, New Mexico, and Apache County, Arizona, federal government workers make up 16.1% and 12.0% of all workers in the county, respectively (EPI 2025b). At the same time, both counties are ranked in the top-10 counties most reliant on federal government transfers—Apache is #2 for Medicaid, and Rio Arriba is #10 for SNAP. In Apache County, federal government transfers account for three-quarters (76.9%) of the county’s economic base, and the earnings of federal government civilian workers account for 11.7%—the Navajo Nation Tribal Government is the county’s largest employer (NACOG 2023). Meanwhile, private earnings account for a mere 2.8% of the county’s economy. In Apache, Trump’s cuts to both the federal workforce and federal government programs mean that the federal government may be unable to fulfill its legal obligations to tribal communities (Brown 2025) that have faced decades of disinvestment and depressed economic outcomes resulting from historic land theft and forced assimilation. Apache County’s poverty rate of 31.2% (AZ Economics 2026) is nearly triple the national rate of 11.1% in 2023 (Shrider 2024).

Trump’s anti-immigrant crackdown and deportation agenda hurt localities with large immigrant populations

Trump has launched a campaign of terror against immigrant communities, communities of color, and those who stand with them. Last summer, Trump federalized local police and deployed thousands of federal troops to diverse cities with large immigrant populations (Kim 2025). Though Washington, D.C., may have experienced the most visible federal troop presence, a function of the district’s lack of statehood and the president’s unchecked authority to mobilize the National Guard there (Dallas 2025), Los Angeles was the first city Trump targeted after public opposition to aggressive immigration raids (Kim 2025). It was soon followed by Washington, D.C.; Memphis, Tennessee; Portland, Oregon; New Orleans, Louisiana; Minneapolis, Minnesota; and Portland, Maine.

These attacks are characteristic of an authoritarian playbook that includes forcing the leaders of diverse, opposition-led communities to bend to the strongman government’s will (McManus, Benson, and Herman 2024). Minneapolis, home to a large immigrant population, was subjected to an unprecedented immigration crackdown that drew widespread protests (Boone 2026). During “Operation Metro Surge,” as it was called, federal immigration enforcement officials made 4,000 arrests and killed two U.S. citizens. Though the true toll of this violent operation may never be fully quantified, initial economic data show clear cause for concern. A recent analysis estimated that Trump’s immigration crackdown has led to a 2.9% decline in consumer spending in Minnesota over a single month—the equivalent of the state’s economy losing $626 million (Rosenthal and Sojourner 2026). Relative to overall consumer spending, the food and accommodation sector (which employs a large share of immigrant workers) saw the most significant decline in January 2026—3.8% or a $46 million reduction in economic activity. Researchers also estimated that nearly 3% of workers in the Minneapolis-Saint Paul region were unable to work during the occupation, resulting in a loss of over $100 million in wages (Sojourner and Rosenthal 2026).

Trump’s deportation agenda will continue to destabilize local communities and result in job losses for immigrant and U.S.-born residents alike (Zipperer 2025). Though immigrants live in counties across the U.S., coastal urban areas tend to have the largest shares of foreign-born residents. Counties with the largest foreign-born populations include Miami-Dade, Florida; Queens, New York; Aleutians, Alaska; and Hudson, New Jersey (see Table 5). Counties with relatively large shares of immigrants may see particularly acute harms from aggressive immigration enforcement.

Communities face overlapping economic threats from attacks on federal workers, the social safety net, and immigrants, but state and local lawmakers can resist them.

The Trump administration’s attacks on the federal workforce, the social safety net, and immigrant communities are designed to exacerbate economic precarity in many communities that are already struggling (Bivens 2026). The implementation of Trump’s authoritarian agenda in the DMV region may be the first, clearest, and in some cases most direct manifestation of its harms, but other localities across the country—particularly those with large federal workforces, those that are heavily dependent on federal revenue and those with sizeable immigrant populations—are far from immune, and many will suffer as much, if not more, from this agenda.

While state and local leaders cannot stop federal attacks, they do have the power to resist Trump’s agenda by improving state labor standards (EPI 2026b), advancing protections for immigrant workers (Díaz and Whitaker 2026), investing in the public-sector workforce (Bivens and Shierholz 2026), and using progressive tax policies (Austin and Davis 2025) to stabilize funding for critical social programs and other investments that workers, families, and communities need.

Notes

1. Throughout this report, unless explicitly noted, the source for all employment rate data is the authors’ analysis of Current Population Survey data (EPI 2026a). We compare an average of calendar year 2025 with calendar year 2024 in order to have adequate sample sizes for the noted demographic groups.

2. Employment level by industry and sector data come from the authors’ analysis of the Bureau of Labor Statistics’ Current Employment Statistics (CES) State and Metro Area (SAE) data.

3. These numbers are calculated using monthly totals rather than annual averages. A quarterly comparison of 2025Q4 to 2024Q4 finds roughly the same results—employment fell by 52,600 jobs (13.9%). The quarterly analysis omits October in both years to maintain an apples-to-apples comparison, accounting for missing data due to the government shutdown that began in October 2025 and the subsequent lapse in Bureau of Labor Statistics funding.

4. The non-federal workforce includes private sector workers as well as state and local government employees.

5. These numbers are calculated using monthly totals rather than annual averages. Quarterly comparisons of 2025 Q4 to 2024 Q4 produce similar results—private sector employment fell by 0.1% in the DMV and grew by 0.7% nationally. The quarterly analysis follows the methodology outlined in note 2.

6. On average, federal workers with advanced degrees typically earn less in wages and total compensation than their private-sector counterparts. Federal workers without an advanced degree typically earn more than their private-sector counterparts and have access to retirement benefits that have become less common in the private sector (CBO 2024).

References

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Díaz, Marisa, and Mimi Whitaker. 2026. How States and Localities Can Strengthen Workplace Protections for Immigrant Workers. National Employment Law Project, January 2026.

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This interactive chartbook provides a statistical snapshot of race and ethnicity in the United States, depicting racial/ethnic disparities observed through

• Population demographics
• Civic engagement
• Labor market outcomes
• Income, poverty, and wealth
• Health

The chartbook also highlights some notable intersections of gender with race and ethnicity, including educational attainment, labor force participation, life expectancy, and maternal mortality. The findings are bracing, as they show how much more work we need to do to address longstanding and persistent racial inequities.

Most charts include data for five racial/ethnic groups in each of the charts—white, Black, Hispanic, Asian American and Pacific Islander (AAPI), and American Indian and Alaska Native (AIAN). In the charts and text, “Americans” refers to all U.S. residents, regardless of citizenship status.

Researchers seeking disaggregated data and statistics for AAPI and AIAN groups are encouraged to look at sources cited in the companion essays in the Anti-Racist Economic Research and Policy Guide: AAPI Data and the Center for Indian Country Development at the Federal Reserve Bank of Minneapolis.

As our efforts illustrate, collecting and maintaining data sources that are representative of the entire U.S. population is an essential first step toward overcoming the invisibility, neglect, and lack of understanding experienced by many communities of color. Future work on this project will involve identifying comparable data from alternative sources that fill in as much of the missing information in the chartbook as possible.

In this interactive chartbook, additional notes and source information can be accessed by clicking on the ellipses ( … ) in the notes and sources lines under the charts.

Population demographics

The U.S. has become more racially and ethnically diverse over the last two decades: Share of U.S. population by race and ethnicity, 2000, 2010, and 2020

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Each decennial Census since 2000 has revealed a more racially and ethnically diverse U.S. population. While the share of people who identify as Black (about 12%) or American Indian and Alaskan Native (0.7%) has remained constant, the non-Hispanic white share of the population has declined from 69.1% in 2000 to 57.8% in 2020. On the other hand, a growing share of U.S. residents identify as Hispanic (increasing from 12.5% in 2000 to 18.7% in 2020) or Asian American and Pacific Islander (increasing from 3.7% in 2000 to 6.1% in 2020). These changing population demographics reflect different trends in birth, mortality, and immigration rates across groups. Since 2000, there have also been significant changes in how people identify racially. Notably, a growing share of people identify as being of two or more races (this would include people who, for example, identify as Black and AAPI, but would not include people who identify as Black and Hispanic, as they are identifying Black alone as their race and Hispanic as their ethnicity). Also, a growing but still small share of people identify as being of a race other than those explicitly defined by the Office of Management and Budget (OMB).

As Trevon Logan notes in his essay, it is the OMB that issues regulations regarding the classifications of race and ethnicity by federal agencies, including the U.S. Census Bureau, which conducts the major household and business surveys used by researchers. There are six permitted race categories and two ethnicity classifications, Hispanic and non-Hispanic. As such, everyone is a member of both a race and ethnicity. For more on the current classifications, see Logan’s essay.

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While U.S. residents are overwhelmingly citizens, Asian American/Pacific Islander and Hispanic citizens are more likely to be first-generation immigrants: Share of U.S. population by race/ethnicity and nativity, 2024

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Across all racial and ethnic groups, an overwhelming majority of people in the United States are U.S. citizens, according to data from the Current Population Survey. However, nativity shares vary across racial groups. White persons (95.9%), American Indian and Alaskan Native (AIAN) persons (81.3%), and Black persons (88.6%) are most likely to have been born citizens (born in the United States or to United States citizens abroad), compared with over half of the Hispanic population (66.7%) and more than one-third (37.8%) of the Asian American and Pacific Islander (AAPI) population.

Immigration status also varies widely. AAPI residents are most likely to be immigrants: more than one-third (38.3%) were not born U.S. citizens but became U.S. citizens (i.e., are naturalized U.S. citizens), while another 23.9% are not citizens. Hispanic residents are next most likely to be immigrants: 12.6% are naturalized citizens and 20.7% are not citizens. These statistics highlight only a fraction of the diversity represented within and across different racial and ethnic groups. As several essays in the Advancing Anti-Racist Economic Research and Policy guide explain, analyses that use categories or group descriptions that are too broadly defined can lead to inaccurate conclusions.

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The uneven geographic distribution of racial and ethnic populations highlights the influence of state and local policy on racial inequality: Share of state population by race and ethnicity, 2020

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The U.S. Census Bureau projects that Black, Hispanic, AAPI, and other people who do not identify as white will collectively account for over half of the population of the United States by 2044. In California, Hawaii, Maryland, Nevada, New Mexico, Texas, and the District of Columbia, the white population is already in the minority, and in Arizona, Florida, Georgia, New Jersey, and New York, white persons make up just over half of the population. This interactive map shows areas of population density for each race or ethnic group (click on a race or ethnic group) along with the racial and ethnic distribution of each state’s population (click on a state). It shows that Southern states and the District of Columbia have the largest shares of residents who are Black, with the highest shares in the District of Columbia (40.9%), Mississippi (36.4%), and Louisiana (31.2%). Southwestern and Western states are home to a large percentage of Latinos, with the highest shares in New Mexico (47.7%), Texas (39.3%), and California (39.4%). AAPI residents, including Native Hawaiians, predictably account for nearly half (46.8%) of the population of Hawaii but are also a significant share of the population in California (15.5%) as well as New Jersey and Washington state (10.2% each). Also, as the group’s name would indicate, American Indian and Alaska Native residents account for the highest share of the population in Alaska (14.8%), followed by New Mexico (8.9%), South Dakota (8.4%), and Oklahoma (7.9%). White Americans account for the largest majority of the population in several Northeastern states (90.2% in Maine, 89.1% in Vermont, and 87.2% in New Hampshire) and West Virginia (89.1%).

The patterns illustrated in the map trace each group’s unique history of settlement, immigration, and migration in this country. But they also help to make a point about the important role that state and local policies play in either improving or worsening racial disparities in the United States. As just one example, EPI research shows that Southern states, which have a high density of Black residents, are more likely than states in other regions to use preemption laws to stop local governments from setting strong labor standards, such as raising the minimum wage and guaranteeing paid sick leave.

For more on preemption laws in the South, see Hunter Blair et al., Preempting Progress: State Interference in Local Policymaking Prevents People of Color, Women, and Low-Income Workers from Making Ends Meet in the South, Economic Policy Institute, September 2020.

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Current population demographics by race/ethnicity and age support projections that people of color will become the collective majority by 2050: Share of U.S. population within given age ranges, by race and ethnicity, 2024

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The changing racial and ethnic makeup of the U.S. population is foretold in the age distribution of different racial and ethnic groups. In 2024, over a quarter (28.9%) of people who identified as Hispanic were under the age of 18, as were about a quarter of those who identified as Black (24.5%), American Indian and Alaska Native (AIAN) (27.9%) and a fifth within those who identified as Asian American and Pacific Islander (19.9%). A smaller share of the white population (17.8%) belonged to this younger age cohort while over a third (36.9%) of white residents were near or at retirement age (age 55 or older)—a much larger share than for other racial and ethnic groups. As the current population ages, the older population will remain predominantly non-Hispanic white while Black, Hispanic, AAPI, and AIAN persons will be a growing share of the younger population. This racial and ethnic generation gap will require balancing the interests of a younger, less wealthy, more racially and ethnically diverse population with those of an older, wealthier, predominantly white population. However, these generations are linked in important ways. Older workers and retirees have a stake in worker, economic, and racial justice for those younger workers who in the years ahead will be a growing share of workers driving the national economy and providing many of the services the aging population relies on. Census population projections from 2022 (the latest available) indicate that in 2050, non-Hispanic white persons will account for less than half (48.4%) of the U.S. population (see U.S. Census Bureau, 2023 National Population Projections Tables, Table 4).

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Men’s educational attainment is highly stratified by race and ethnicity, with American Indian and Alaska Native, Hispanic, and Black men most likely to be “working class”: Share of men aged 25 and older within given level of educational attainment, by race and ethnicity, 2024

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The term working class has been used to describe working-age adults who have less than a bachelor’s degree. Based on their high shares without a bachelor’s degree or more education, American Indian and Alaska Native (AIAN) (85.3%), Hispanic (80.9%), and Black (76.5%) men are more likely to be considered working class (under this definition) than are white (60.3%) or Asian American and Pacific Islander (AAPI) (40.7%) men. Even among the groups of men most likely to be considered working class, there is still a wide range of educational attainment that includes everything from less than a high school diploma to some college. The some college category includes attendance at a four-year or two-year institution, but no degree; it also includes completion of a two-year associate or technical degree. The groups with the highest shares of people with less than a high school education are Hispanic men (27.6%) and AIAN men (23.5%) and 57.7% of Hispanic men and over half of AIAN men (58.2%) have no education beyond high school. While about half (47.0%) of Black men also have no education beyond high school, Black men are more likely than either Hispanic or AIAN men to have a bachelor’s or advanced degree, but still much less likely to have that level of education than either white or AAPI men. AAPI men lead all other racial groups in the share (59.2%) who have a bachelor’s or advanced degree. These patterns of educational attainment are shaped by multiple factors, including differences in immigration policies applied to Asian versus Latin American countries, as well as the legacy of racial discrimination and oppression that severely limited educational opportunities for generations of Black and Native Americans.

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Most women have more than a high school education, but Latinas and AIAN women lag behind other groups in attaining higher education: Share of women aged 25 and older within given level of educational attainment, by race and ethnicity, 2024

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In 2024, across most racial and ethnic groups, at least half of women aged 25 or older had some education beyond a high school diploma. Latinas were the exception—only 49.1% had some level of education beyond high school and 24.2% had less than a high school education, a much higher percentage than any other group of women (1.2 to nearly 5 times as much). Those women least likely to have a bachelor’s or advanced degree were American Indian and Alaskan Native (AIAN) women (19.7%) and Latinas (23.9%). Asian American and Pacific Islander (AAPI) and white women had the highest levels of educational attainment with 56.9% of AAPI women and 41.8% of white women having at least a bachelor’s degree, followed by 29.9% of Black women. As with men, these patterns of educational attainment are shaped by multiple factors, including differences in immigration policies applied to Asian versus Latin American countries, as well as the legacy of racial discrimination and oppression that severely limited educational opportunities for generations of Black and Native Americans. But compared with male educational attainment by race and ethnicity women tend to have higher levels of educational attainment (see Chart 5).

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While the Black and AIAN imprisonment rate has decreased, Black and AIAN people are still five times as likely as white people to be imprisoned: Imprisonment rates per 100,000 U.S. residents by race and ethnicity, 2012–2022

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In response to the demand for criminal justice reform and a shift away from the “tough on crime” politics of the 1980s and 1990s, imprisonment rates for Black, American Indian and Alaska Native (AIAN), Hispanic people have fallen over the last decade. But Black, AIAN, and Hispanic people are still much more likely to be incarcerated than white people, whose imprisonment rate has stagnated over the past decade. Over 1,000 out of every 100,000 U.S. residents who are Black or American Indian and Alaska Native (AIAN) were imprisoned in 2023, followed by 603 out of 100,000 Latino U.S. residents, 229 out of 100,000 white U.S. residents, and 88 out of 100,000 Asian American and Pacific Islander U.S. residents. Thus, the approximately 1.8 million people held in U.S. prisons at the end of 2022 —an often-forgotten segment of the U.S. population—are disproportionately Black, AIAN, Hispanic, and other people of color. 

Data on the size of the overall incarcerated population come from the “Correctional Populations in the United States, 2022—Statistical Tables” published by the U.S. Department of Justice in May 2024. 

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Black and AIAN men have an exceptionally high imprisonment rate: Imprisonment rates per 100,000 U.S residents, by race/ethnicity and gender, 2022

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This chart makes two facts very clear: That imprisonment in the United States is not only a gendered issue—with men being much more likely to be imprisoned—but also an issue of racialized gender, with Black and American Indian and Alaska Native (AIAN) men being far and away the most highly imprisoned group. Among women, AIAN residents had the highest imprisonment rate (173 per 100,000), followed by Black residents who had an imprisonment rate (64 per 100,000) in 2022. AIAN women were almost three times as likely to be imprisoned as Black women, around four times as likely to be imprisoned as White and Hispanic women, and 34 times as likely to be imprisoned as AAPI women. Among men, Black residents had the highest imprisonment rate (1,826 per 100,000), followed by AIAN men (1,443 per 100,000). Black men were more than twice as likely to be imprisoned as Hispanic men, more than five times as likely to be imprisoned as white men, and almost 13 times as likely to be imprisoned as AAPI men. AIAN men were almost twice as likely to be imprisoned as Hispanic men, more than four times as likely to be imprisoned as white men, and more than ten times as likely to be imprisoned as AAPI men.

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Civic engagement

Consistently higher turnout among white voters was challenged by historic Black voter turnout in 2012 and, to a lesser extent by historic Hispanic and Asian voter turnout in 2020: Voter turnout in presidential election years by race and ethnicity, select years 1992 to 2024

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The right to vote is the most powerful right of U.S. citizenship—and widespread voter participation is essential to a functional democracy. Yet many U.S. citizens ages 18 and older do not vote. Data on voter participation during presidential election years since 1992 reveal that turnout varies significantly by race and ethnicity and changes over time. Since 1992, voter turnout has typically been highest among white voters—ranging from 60.7% to 70.9%—although Black voter turnout saw a huge increase in 2008 and 2012 during the election and reelection of the nation’s first Black president, Barack Obama. In fact, 2012 was the only election in which Black voter turnout (66.2%) exceeded white voter turnout (64.1%). Hispanic and Asian voter turnout was less than 50% in all presidential election years between 1996 and 2016, until both groups had the largest turnout in decades in 2020 (53.7% and 59.7% respectively). In the 2024 presidential election, voter participation declined among Black, Hispanic and AAPI adults. While one’s personal decision to participate in an election can be influenced by any number of factors—including enthusiasm about a particular candidate or confidence in the democratic process—rampant forms of voter suppression in some states undoubtedly contribute to these disparities as well.

For more on the impact of state laws that limit access to voter registration, revoke the right to vote for returning (formerly incarcerated) citizens, or otherwise make it more difficult for certain populations to cast a ballot, see “State Voting Laws,” Brennan Center for Justice, accessed May 5, 2022;  “State Voting Rights Tracker,” Voting Rights Lab, accessed May 5, 2022.

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Amid dramatic decline in union membership since the 1970s, Black workers have held onto the highest rate of union membership for decades: Union membership rates, by race and ethnicity, 1973–2024

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Like the constitutional right to vote in civil society, union membership gives workers a voice—in this case, a voice at work. But as the chart shows, since 1973, union membership has declined for all racial and ethnic groups. Union membership is an important metric of the state of the American worker given the role that labor unions play in giving workers a stronger, collective voice to advocate for higher pay, better benefits, and training and promotional opportunities, as well as protections against discrimination and harassment. In a unionized workforce, for example, collective bargaining results in labor contracts that help to create greater transparency through clearly defined policies and pay structures. These contracts help reduce the potential for pay discrimination by limiting an employer’s discretion in paying different wages to comparably qualified individuals doing the same job and by providing workers with critical protections and direct recourse against other forms of exploitation or mistreatment. The benefits of union membership are a likely contributor to the higher union membership rate of Black workers, given their long history of unequal treatment relative to other groups of workers. Between 1973 and 1980, Hispanic workers also had higher rates of union membership than white workers. While the subsequent across the board decrease in union membership has brought union membership rates by race and ethnicity closer together, in 2024, Black workers were still more likely to be union members (11.7%) compared with white workers (10.0%), Asian American and Pacific Islander workers (8.9%), and Hispanic workers (8.5%).

Still, the labor movement, like any other U.S. institution, is not immune to racism. Unions must continue to become more diverse, inclusive, and dynamic as they serve the vital role of leveling the playing field for all workers.

For more on the benefits and protections conferred by union membership, see Celine McNicholas et al., Why Unions Are Good for Workers—Especially in a Crisis Like COVID-19, Economic Policy Institute, August 2020 and Valerie Wilson, “The Costs of Racial and Ethnic Labor Market Discrimination and Solutions That Can Contribute to Closing Employment and Wage Gaps,” testimony before the U.S. House of Representatives Select Committee on Economic Disparity and Fairness in Growth, January 20, 2022.

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Labor market

Black women have maintained the highest labor force participation rate amid post-1970 rise in women’s labor force participation overall: Labor force participation rate for women by race and ethnicity, 1973–2024

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The labor force participation rate is an important indicator of economic well-being. It shows the number of people in the labor force—people who are employed or unemployed but looking for work—as a share of the number of civilian, noninstitutionalized people ages 16 and older. Across racial and ethnic groups, women’s labor force participation rose significantly from the 1970s through the 1990s for a number a reasons: increased access to higher education, and the introduction and widespread availability of the birth control pill, to name a few. After leveling off during most of the first decade of the 2000s, labor force participation by women declined during or after the Great Recession of 2007–2009. And it declined again during the 2020 COVID-19 pandemic and recession as the burden of job losses and care responsibilities disproportionately impacted women. In 2024, Black women had the highest labor force participation rate at 60.5%, followed by Hispanic (58.9%), Asian (58.6%), white (56.7%), and American Indian and Alaska Native women (55.1%). While Latinas have historically had the lowest rates of labor force participation among women, their labor force participation rate had been climbing steadily in the four years leading up to the COVID-19 pandemic. Historically, Black women have had stronger labor force attachments than other groups of women. This is part of the legacy of being forced to work as enslaved people, but the necessity of work has continued for Black women who are often co-breadwinners if not sole earners for their households.

For more on the rise of women’s labor force participation from the 1970s see Elisabeth Jacobs and Kate Bahn “Women’s History Month: U.S. women’s labor force participation”, Washington Center for Equitable Growth, March 22, 2019.  

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Hispanic men have maintained the highest labor force participation rate even as labor force participation of all men has declined since the 1970s: Men’s labor force participation rate by race and ethnicity, 1973–2024

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Across all racial and ethnic groups, men’s labor force participation rates have declined significantly since the 1970s, with the sharpest decline occurring during and since the Great Recession of 2007–2009. While this trend in part reflects an aging population with a growing share of retirees, researchers have suggested that labor force participation has fallen among prime-age men (ages 25–54) due to a rise in serious health conditions that are a barrier to work, the emerging opioid crisis, or technological changes that encourage younger men  (under age 30) to allocate less time to work and more time to leisure activities like playing video games. Unlike with Black women, who have the highest labor force participation rate among women, Black men in 2024 had the lower labor force participation rates than white and Asian men (65.9%). And unlike with Hispanic women, who have historically had the lowest labor force participation rates among women, Hispanic men have had the highest labor force participation rate, which reached 75.5% in 2024. The ranking of men’s labor force participation rates by race and ethnicity has remained constant over the last three decades.

For more on the likely reasons for declining male labor force participation see Alan Krueger, Where Have All the Workers Gone? An Inquiry into the Decline of the U.S. Labor Force Participation Rate, Brookings Papers on Economic Activity, September 2017; and Mark Aguiar et al., “Leisure Luxuries and the Labor Supply of Young Men,” National Bureau of Economic Research Working Paper 23552, June 2017.

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Black and AIAN unemployment is consistently higher than unemployment of all other racial and ethnic groups: Annual unemployment rate by race and ethnicity, 1979–2024

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Relative rates of unemployment by race and ethnicity have been remarkably consistent over time. Typically, the annual unemployment rates of American Indian and Alaska Native (AIAN), Black, and Hispanic workers are significantly higher than those of white workers. The difference between Asian and white unemployment rates is smaller, and the size of the gap fluctuates, as does which group has the lower unemployment rate. In 2024, this pattern held, with an unemployment rate of 6.5% for AIAN workers, 6.0% for Black workers, followed by 5.1% for Hispanic workers, 3.6% for white workers, and 3.5% for Asian workers. While 2023 saw historical low rates for Black unemployment, one of the most enduring features of the U.S. labor market is the roughly 2-to-1 ratio of the Black and white unemployment rates.

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Higher education typically lowers a worker’s chances of being unemployed but does not eliminate racial and ethnic disparities in unemployment rates: Unemployment rate by race/ethnicity and educational attainment, 2024

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A breakdown of unemployment rates by race, ethnicity, and education level shows the limits of educational attainment as a factor in addressing inequitable economic outcomes. As the chart shows, racial and ethnic disparities in unemployment rates exist at every level of educational attainment. And Black workers have the highest rates of unemployment among all groups without a college degree. In fact, even at historically low rates of unemployment in 2024, only the most highly educated Black workers approached anything near unemployment rate parity with their white counterparts. The figure also shows that while education can contribute to better outcomes—unemployment rates are lower for all groups at higher levels of education—education alone does not necessarily create equal outcomes. Reading this chart alongside Chart 13 suggests that differences in the average unemployment rates of racial and ethnic groups can only be partially explained by relative differences in education, skill, experience or local labor market conditions—discrimination remains an undeniable factor.

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Black, Hispanic, and AIAN workers earn lower wages and have smaller gender wage disparities than their white and AAPI counterparts: Median wages by race/ethnicity and gender, 2024

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There are sharp differences in the wages earned by typical workers of different racial groups in the United States. Asian American and Pacific Islander (AAPI) and white workers are paid the highest wages at the median, while Black, Hispanic, and American Indian and Alaska Native (AIAN) workers are paid significantly less. The gender differences are also greater among AAPI and white workers than among Black, Hispanic and AIAN workers. While AAPI and white men far out-earn AAPI and white women, Black and Hispanic men and women have much more similar median wages.

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Even after controlling for education and other factors known to affect earnings, women—particularly Black and Hispanic women—are paid far less than white men: Regression-adjusted hourly wage gaps for women relative to non-Hispanic white men, by race and ethnicity, 2024

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Women of all racial and ethnic groups in the U.S. have a significant pay penalty by virtue of their gender, even when we account for several factors that could reasonably influence a worker’s productivity or wage rate, including education, marital status, age (a measure of potential experience) and geographic area (a measure of local labor market conditions). Black and Hispanic women face an additional pay penalty by virtue of their race or ethnicity. The chart depicts these wage gaps, presented as how much less women make than non-Hispanic white men. The fact that Black and Hispanic women earn about a quarter less than white men on average when calculating regression-adjusted wage gaps mean, then, that the pay penalty is not a result of differences in formal education between those groups of women and white men. One partial explanation for these wage disparities is occupational segregation, by which women of color are more highly concentrated in occupations with low pay, even relative to their education level. However, women of all races and ethnicities also often earn less than men in the same occupation (not shown in the chart), an indication of potential pay discrimination.

For more on occupational segregation and on gender pay gaps by occupation, see Jessica Schieder and Elise Gould, Women’s Work” and the Gender Pay Gap: How Discrimination, Societal Norms, and Other Forces Affect Women’s Occupational Choices—and Their Pay, Economic Policy Institute, July 2016; Emily Carew and Valerie Wilson, “Latina Equal Pay Day: Latina Workers Remain Greatly Underpaid, Including in Front-Line Occupations,” Working Economics Blog, Economic Policy Institute, October 20, 2021; Valerie Wilson, “Black Women Face a Persistent Pay Gap, Including in Essential Occupations During the Pandemic,” Working Economics Blog, Economic Policy Institute, August 2, 2021.

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Income, poverty, and wealth

Racial and ethnic disparities in median household income have been largely persistent across time: Inflation-adjusted median household income (2024 dollars), by race and ethnicity, 1972–2024

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In the United States, households of different racial and ethnic backgrounds bring in significantly different amounts of income and have done so for decades. At the median, Black, Hispanic, and American Indian and Alaska Native (AIAN) households earn the least on an annual basis, while Asian and white households earn the most. It is notable, though, that in 2023, Black households had the highest household income on record and experienced the largest increase in income between 2020 and 2023. Significant gaps in employment opportunities (shown in Chart 13) and lower wage levels (shown in Chart 15) translate into lower incomes among Black, Latino, and AIAN households. Household income is also a function of the number of earners in a household. Though not shown here, past EPI research found that in the pre-pandemic economy, about a third of Black nonelderly households (where the head of household is age 18–64) had two or more earners, compared with nearly half of white and Hispanic nonelderly households. This racial disparity in the number of household earners is not just a function of how many working-age adults live in the household, or family structure, but is another measurable consequence of the persistent 2-to-1 ratio between the Black and white unemployment rates (shown in Chart 13). As income inequality in the United States has increased in general over the past 50 years, disparities between the least and most well-off groups have continued to persist and, in some cases, have grown.  

For more on earners per household by race, see Elise Gould and Valerie Wilson, Black Workers Face Two of the Most Lethal Preexisting Conditions for Coronavirus—Racism and Economic Inequality, Economic Policy Institute, June 2020. For more on increasing income inequality, see Elise Gould, “Decades of Rising Economic Inequality in the U.S.,” testimony before the House of Representatives Ways and Means Committee, Washington, D.C., March 27, 2019.

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Black and AIAN households are more likely to have the lowest annual incomes—under $25,000 per year in 2024: Share of households within given income range by race and ethnicity, 2024

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This chart extends beyond the data on median or midpoint of household income shown in Chart 17 to provide a more detailed look at where different groups fall across the entire household income distribution. In 2024, 22.9% of Black households, 23.3% of American Indian and Alaska Native households, 15.1% of Hispanic households had annual incomes under $25,000, compared with just 11.4% of white households and 9.3% of Asian households. This $25,000 figure is well below the 2024 official poverty threshold for a family of two adults and two children ($31,812). Conversely, 29.3% of Asian households and 17.8% of white households had annual incomes at or above $200,000—the highest income category—compared with only about 6%-10% of Black, AIAN, and Hispanic households.  

Poverty threshold data can be found in the U.S. Census Bureau’s Poverty in the United States: 2024 data tables, published September 09, 2025 

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Persistently elevated AIAN, Black, and Hispanic child poverty rates have thwarted progress reducing overall child poverty in the U.S.: Child poverty rates, by race and ethnicity, 1974–2024

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A cruel and unfortunate reality of structural racism in the U.S. economy is that even in the “best” of economic times, Black, American Indian, and Alaska Native (AIAN), and Hispanic children experience much higher rates of poverty than white children. In 2024, 30.5% of AIAN children, 25.4% of Black children and 20.2% of Hispanic children lived below the official poverty threshold, compared with just 8.2% of non-Hispanic white children 6.4% of Asian children. While child poverty has fallen significantly for Black, Hispanic, and Asian American children over the past 40 years, Black and Hispanic child poverty rates remained over 20% in 2024. Additionally, in 2024, AIAN children had the highest rates of child poverty at over 30 percent (30.5%). This large and persistent disparity in child poverty combined with the fact that Black and Hispanic children have become an increasing share of the underage 18 population over time (see Chart 1 and Chart 4) has resulted in very little change in the overall child poverty rate since 1974. Given the long-term effects of exposure to poverty in childhood, addressing these persistent disparities must play a role in our approach toward building equity and moving the needle on child poverty.

For more on the long-term effects of exposure to poverty in childhood, see Kerris Cooper and Kitty Stewart, “Does Money Affect Children’s Outcomes? An Update,” CASEpapers (203), The London School of Economics and Political Science, July 2017; Randall Akee et al., “Parents’ Incomes and Children’s Outcomes: A Quasi-Experiment,” American Economic Journal: Applied Economics, January 2010.

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Poverty rates are higher among AIAN, Black and Hispanic working-age adults: Poverty rates for age 18–64, by race and ethnicity, 1974–2024

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While poverty across the working-age population (ages 18 to 64) is lower than that for children (see Chart 19), disparities by race and ethnicity follow a similar trend, with American Indian and Alaska Native (AIAN), Black, and Hispanic adults more likely to be impoverished than white and Asian adults. Poverty is a measure of economic deprivation, and among working-age adults in particular, reflects disparities in unemployment, wages, and income. Life circumstances, such as severe disability and major illness—which can also limit earned income or quickly deplete any available savings—also contribute to poverty for this age group. The racially coded misrepresentation of poverty as some kind of moral or cultural pathology has hindered the political will needed to sustain and strengthen vital income supports that have proven effective in fighting poverty.  

For more on the misrepresentation of poverty as a cultural pathology see William “Sandy” Darity Jr., “Revisiting the Debate on Race and Culture: The New (Incorrect) Harvard/Washington Consensus.” Du Bois Review: Social Science Research on Race 8, no. 2, 467–476. For more on the vital income supports that would lessen poverty see Asha Banerjee and Ben Zipperer, “Social Insurance Programs Cushioned the Blow of the COVID-19 Pandemic in 2020,” Working Economics Blog, Economic Policy Institute, September 14, 2021.

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There are large racial disparities in poverty at older ages (65 and older)—likely reflecting differences in retirement preparedness and/or lifetime income disparities: Poverty rates for people ages 65 and older, by race and ethnicity, 1974–2024

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The poverty seen among older Americans in the chart is most likely the result of a lifetime of low earnings and a lack of retirement preparedness. While research shows that Social Security plays a critical role in keeping poverty rates among older Americans lower than they otherwise would have been (not depicted in the chart), older Black, Hispanic, and American Indian and Alaska Native (AIAN) adults still have relatively high poverty rates. Older Asian Americans are also more likely to live in poverty than older white Americans. Additionally, older Asian Americans have higher poverty rates than younger Asian Americans (see Chart 19 and Chart 20). This is likely due to a larger share of older Asian Americans having worked comparatively few years in the United States, or in jobs where they were unable to accumulate the necessary years for Social Security eligibility, leaving them less able to take advantage of work-based social safety net programs like Social Security.

For more on the causes of poverty among older Americans and the capacity of Social Security to lift older Americans—particularly women and people of color—out of poverty, see Kathleen Romig, Social Security Lifts More People Above the Poverty Line Than Any Other Program, Center on Budget and Policy priorities, April 2022. For more on the economic condition of the older Asian American population, see Victoria Tran, “Asian American Seniors Are Often Left Out of the National Conversation on Poverty,” Urban Wire (Urban Institute blog), May 31, 2017.

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Racial wealth disparities are stark and persistent, reflecting a history of exploitation and exclusion: Median family net worth by race and ethnicity, selected years from 1989 to 2022

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The chart shows sharp racial and ethnic disparities in net worth observed across time in the United States. Though not shown in the chart, these disparities reflect the differences in lived economic experiences between white, Black, Hispanic, and Asian families. Wealth can be accumulated both within and across generations, such that a high net worth can result from the benefit of prime earning years with 1) relatively few employment disruptions, 2) access to wealth-building savings and investment vehicles, 3) relatively few serious negative health shocks, and 4) well-timed wealth transfers from parents and grandparents.  The typical white household has many times the wealth of the typical Black or Hispanic household due to 1) their privileged position in the American labor market, which grants them access to more consistent and higher-quality employment opportunities, 2) their more limited exposure to the health risks brought on by poorer living conditions and discrimination, and 3) their history of access to wealth-building opportunities from which other groups have been excluded. 

In 2022, the Survey of Consumer Finances reported household wealth data for the Asian American population for the first time. Asian household wealth far outstrips that of other households in 2022, though this statistic should be couched with appropriate context: Asian Americans are an incredibly diverse group with varying economic circumstances related to, among other things, immigration history and country of origin; moreover, the SCF oversamples households that are likely to be wealthy. Further disaggregation of wealth data by immigration history could be useful in illuminating wealth disparities within the Asian American population.  

For more on the systemic barriers to Black wealth building see Natasha Hicks, Fenaba Addo, Anne Price, and William Darity Jr., Still Running Up the Down Escalator: How Narratives Shape Our Understanding of Racial Wealth Inequality, The Samuel Dubois Cook Center on Social Equity, 2021. For more on the barriers to Hispanic wealth building see Dedrick Asante-Muhammad, Alexandra Perez, and Jamie Buell, “Racial Wealth Snapshot: Latino Americans.” National Community Reinvestment Coalition, September 17, 2021.

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Health

Racial disparities in life expectancy reflect the cumulative disadvantage of living as a minority in the United States: Women’s and men’s life expectancy at birth, by race and ethnicity, 2022

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Racial disparities in life expectancy have been documented as far back as statistics on life expectancy have been recorded in the U.S, with clear and persistent distinctions between privileged groups and disadvantaged groups. That is, rather than groups shifting in their ranking of life expectancy randomly across time, there are distinct patterns in which groups live longer lives than others. In general, Black and AIAN women and men live much shorter lives than white and Asian women and men. 

In 2022, Asian American women and men had the longest life expectancies, at 86.3 years and 82.3 years respectively. AIAN women and men had the lowest life expectancies, at 64.5 years and 71.3 years respectively. This massive gap in life expectancy approaching two decades can be attributed to several factors, many of which are structural and rooted in economic disparity. In recent years, life expectancy gains have disproportionately gone to those in the highest income categories, who are disproportionately white and Asian (see Chart 18). Alongside the history of white supremacy and anti-Black racism in the United States, these economic roots of also help to explain persistent the persistent Black-white gap in life expectancy. That Black-white gap has fluctuated somewhat over the past decade, shrinking due to the impact of opioid-related “deaths of despair” on lowering white life expectancy, and reopening as COVID-19 related mortality disproportionately impacted Black and brown communities. 

Hispanic women and men tend to live longer than white women and men, though that life expectancy advantage has been shown to diminish with subsequent generations of U.S.-born Latinos. This suggests that there may be something uniquely deleterious about living as a minority in the United States.

For more on gaps in life expectancy, effects of the opioid crisis, and Hispanic life expectancy see Congressional Research Service, The Growing Gap in Life Expectancy by Income: Recent Evidence and Implications for the Social Security Retirement Age, CRS Report R44846, July 6, 2021; Helena Hansen and Julie Netherland, “Is the Prescription Opioid Epidemic a White Problem?” American Journal of Public Health 106, no. 12 (December 2016), 2127–2129 (doi: 10.2105/AJPH.2016.303483); Osea Giuntella, “The Hispanic Health Paradox: New Evidence from Longitudinal Data on Second and Third-Generation Birth Outcomes,” SSM – Population Health, vol. 2 (December 2016), 84–89 (doi.org/10.1016/j.ssmph.2016.02.013).

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The Affordable Care Act significantly reduced uninsured rates across racial and ethnic groups, but disparities remain: Uninsured rates by race and ethnicity, 2008–2024

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The Affordable Care Act (the ACA or “Obamacare”) expanded health insurance coverage to middle- and low-income Americans, which disproportionately benefited those groups with the least access—Hispanic Americans and American Indians and Alaska Natives (AIAN), and to a lesser extent Black Americans. Despite the marked improvement in health insurance coverage rates since the implementation of ACA, disparities between groups remain stark, with Hispanic and AIAN uninsured rates double Black rates, and approaching four times as high as the uninsured rates of white and Asian American and Pacific Islanders (AAPI). Early diagnosis and treatment are essential to minimizing the severity of chronic illnesses, and regular health care is important for promoting better overall health. The lack of health insurance often results in a choice to delay receiving health care until one’s condition is critical, contributing to racial disparities in health outcomes and life expectancy.

For more on how the ACA expanded health coverage, particularly to certain groups, see Samantha Artiga, Latoya Hill, Kendal Orgera, and Anthony Damico. “Health Coverage by Race and Ethnicity, 2010–2019,” Kaiser Family Foundation, July 16, 2021; Jesse Cross-Call, Medicaid Expansion Has Helped Narrow Racial Disparities in Health Coverage and Access to Care, Center on Budget and Policy Priorities, October 2020.

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Black mothers are far more likely to die from pregnancy-related causes than are white and Hispanic mothers: Pregnancy-related deaths per 100,000 live births by race and ethnicity, 2023

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Maternal mortality rates are a stark indicator of racial disparities in public health in the United States. Black women are over twice as likely to die from a pregnancy-related cause as white women, almost three times as likely as Hispanic women, and almost four times as likely as Asian women. Although not shown in the chart, these racial disparities persist regardless of a woman’s social or economic status. Health status and differential access to quality prenatal care play a major role in maintaining these disparities, as does structural racism more generally. To adequately address these disparities in maternal health outcomes, we must confront racism and bias in the U.S. health care system and the implications for how health care providers and personnel communicate with and treat patients.

For more on the causes and solutions to Black maternal mortality, see “Working Together to Reduce Black Maternal Mortality,” Centers for Disease Control and Prevention, April 6, 2022.

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AIAN population 1-year estimates and 3-year rolling averages, select charts

Appendix

Appendix

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Summary:

• From 1916–1970, 6 million Black Americans fled the violence and economic oppression of the rural South. Among the legacies of this Great Migration is the concentration of Black Americans in urban areas.
• Today, 10 metro areas—New York, Atlanta, D.C., Chicago, Dallas, Houston, Philadelphia, Miami, Los Angeles, and Detroit—have the largest Black populations in the country and are home to 38.6% of the Black labor force.
• This analysis finds evidence of relative economic prosperity and hardship across and within these 10 metro areas, demonstrating huge stakes associated with federal budget and job cuts, anti-equity backlash, and growing concerns of a self-inflicted recession.
• Since taking office, Trump has pushed an anti-equity agenda that rolls back the clock on hard-won federal policies establishing equal employment and core labor standards and protections for Black workers. The passage of those laws was pivotal in expanding rights and opportunities sought across the decades of the Great Migration and Civil Rights Movement.
• Mass firings of federal employees and budget cuts will have harmful consequences for Black Americans across class lines.
  • Given the large share of the state’s federal workers in metro Atlanta (51% of GA total), D.C. (60% of combined D.C., MD, VA & WV total) and New York (63% of combined NY & NJ total), Trump’s attack on the public sector threatens what has historically been a pathway to better, more equitable jobs for Black Americans—thanks to robust anti-discrimination policies and public-sector collective bargaining.
  • Although these cities anchor metro areas with some of the highest Black median household incomes in the nation, federal grant funds provide critical support to under-resourced inner-city communities. Many of those federal investments in low-income and working-class communities were cut in the Republican-led budget reconciliation bill.
• In addition to his attacks on equity and workers’ rights, Trump’s policy path leads straight to recession—jeopardizing Black workers’ labor market gains in recent years, including historically low unemployment and faster wage growth.
• Based on 2023 estimates from the American Community Survey, metro area Black unemployment was lower than the Black national average in Atlanta, D.C., Dallas, Miami, and Philadelphia.
• While overall real median household income declined 1.1% between 2019 and 2023, Black median household income grew by 2.8%.
• In 2023, Black median household income exceeded the national median of $53,927 in all but two (Chicago and Detroit) of the metros observed. It was highest in the D.C. ($89,912) and Atlanta ($70,969) metro areas.
• In the face of federal rollbacks of civil and worker’s rights and growing concerns about recession, state and local governments should act to maintain and strengthen basic protections, like minimum wage and unemployment insurance, while continuing local efforts to advance racial equity and justice. However, local leaders in red states, like Florida and Texas, face state-imposed obstacles to passing progressive economic and racial justice policies. 

The concentration of Black Americans in urban areas is one of the legacies of the Great Migration—the period between 1916 and 1970 when 6 million Black Americans fled the violence and economic oppression of the rural South in search of safety and better job opportunities in cities throughout the Northeast, Midwest, and West. But even in non-Southern U.S. cities, many continued to face poor working conditions as well as employment and pay discrimination, leaving them just marginally better off than in the places they fled. Rather, significant gains in economic status only became possible through sweeping changes to federal labor and civil rights laws born from years of protest and political pressure during the decades of the Great Migration and beyond. While landmark federal labor laws passed during the 1930s improved working conditions for most white workers, many Black workers were initially excluded from the right to organize unions under the National Labor Relations Act of 1935, or minimum wage and overtime pay protections under the Fair Labor Standards Act of 1938. The steady demand for equal protection under these and other laws led to the passage of the Civil Rights Act of 1964, prohibiting segregation at all places of public accommodation and discrimination by employers and labor unions based on race, color, religion, or national origin. These federal labor and civil rights laws set a national standard for fair working conditions and equal treatment that some state and local governments have enhanced to varying degrees based on local political and economic conditions. In many cities with large Black populations, policy decisions and local economic conditions yield both positive and negative results for Black Americans.

The diverse experiences of Black people across metro areas1 exemplify the notion that Black America is not a monolith. The unique political and economic dynamics in each place produce relative economic prosperity and hardship that make up the collective economic experience of Black Americans. However, even areas once sought as places of refuge and economic opportunity are now contending with a president whose actions undermine federal laws establishing equal employment and other civil rights, as well as core labor standards and protections.

Since taking office, Trump has pushed a revisionist version of history that erases any acknowledgement of the racism, violence, and oppression that created persistent racial inequities and forever changed the demographic composition of U.S. cities. This includes issuing a barrage of executive orders that roll back the clock on hard-won federal policies that have helped Black Americans attain many of the opportunities sought through the Great Migration and Civil Rights Movement of the 1950s and 1960s. Instead, Trump’s anti-diversity, equity, and inclusion (DEI) rhetoric centers white men as the primary victims of discrimination and calls into question the “merit” or qualifications of almost anyone else. He has used those false narratives to justify eliminating the use of disparate impact liability and redirecting enforcement priorities at the Equal Employment Opportunity Commission and Office of Federal Contract Compliance Programs—severely weakening the two agencies responsible for making sure employers comply with anti-discrimination law. Trump’s anti-equity agenda—along with efforts to decimate the federal workforce, cut services and programs that working families and low-income communities rely on, and attacks on labor standards and workers’ union and collective bargaining rights—are just some of the many harmful actions that hurt workers and put the economy at risk (McNicholas et al. 2025).

As a benchmark for assessing what’s at stake under Trump’s harmful economic policies and anti-equity agenda, we explore economic conditions for Black Americans in 10 U.S. metro areas with the largest Black populations. This list includes nine of the country’s largest metros overall—anchored by the principal cities of New York, Atlanta, Washington, D.C., Chicago, Dallas, Houston, Philadelphia, Miami, and Los Angeles—as well as Detroit. Today, these 10 metro areas, including four in Southern states, are home to 38.6% of the Black labor force and 26.9% of the total labor force. Each of these metro areas account for at least one-third of their respective state’s Black labor force. Additionally, Black Americans are the largest demographic group in the principal cities of Detroit (75.9%), Atlanta (46.4%), Washington, D.C. (40.9%), and Philadelphia (39.5%) and represent over one-fifth of the population in all but Los Angeles (8.5%) and Miami (14.1%).

We examine unemployment rates, median household income, the size of the federal workforce, and federal grant dollars awarded to these places in 2023. Our analysis compares economic outcomes for Black Americans across metro areas and relative to national and state averages and considers some of the factors contributing to those differences. This cross-metro analysis allows us to go beyond a simple categorization of economic conditions as good versus bad or equal versus unequal. Instead, it raises important questions about why conditions are better in some places and worse in others. Finally, we explore the potential for state and local policy to provide a buffer against damaging federal actions that increase the risk of recession, harm workers, and exacerbate racial inequities.

Metro area unemployment rates and income reveal relative economic prosperity and hardship among Black Americans

The chaotic and harmful actions of the second Trump administration have raised the risk of recession for the otherwise strong and resilient labor market Trump inherited. One of the greatest casualties of a completely self-inflicted recession would be the labor market gains experienced by Black workers in recent years, including historically low unemployment and faster wage growth (Cid-Martinez, Maye, and Marvin 2025).

According to official estimates from the Bureau of Labor Statistics (BLS), the average annual Black unemployment rate in 2023 was a record low (5.5%), compared with an overall national unemployment rate of 3.6%. This analysis compares estimates of national, metro, principal city, and state unemployment rates for Black workers using data from the American Community Survey (ACS). ACS provides better coverage of metro area and principal city Black unemployment rates, but 2023 national estimates are higher than those reported by BLS due to differences in the survey reference periods.2

As shown in Figure A, in 2023, five of the 10 metro areas—Washington, D.C., Miami, Atlanta, Dallas, and Philadelphia—each outperformed the ACS-estimated national average of 7.2% for Black Americans. Across all 10 metro areas, Black unemployment ranged from a low of 5.6% in metro Atlanta to a high of 10.4% in the Chicago metro area.

Figure A

Figure B reveals that metro area Black median household income exceeded the national median of $53,927 in all but two of the metros observed. The exceptions were the Midwestern metro areas of Chicago and Detroit—the same places where Black unemployment was highest in 2023. Although incomes of Black residents in metro Chicago and Detroit were lower relative to the national median and other metros, their incomes were higher than the median Black household in the states of Illinois and Michigan. Median Black household incomes in those states were also the lowest among the states observed for this analysis.

Figure B

At the opposite end of the scale, Black median household income was highest in the D.C. ($89,912) and Atlanta ($70,969) metro areas. Notably, metro D.C.’s Black median household income was also significantly higher than the overall national median of $77,719. Black households in the New York ($65,758) and Dallas ($63,376) metro areas also had substantially higher median incomes than the typical Black household nationwide.

Relatively higher incomes and lower unemployment in metro D.C. and Atlanta are consistent with the fact that these places also had the largest shares of highly educated Black workers. The share of Black college graduates in the D.C. (40.8%) and Atlanta (36.2%) metro areas is well above the share of Black college graduates nationally (26.2%) and at least as high as the share of all college graduates nationwide. In contrast, the Detroit metro area had the lowest share of Black college graduates (20.8%). As we will discuss later, the high concentration of federal employment and related professional job opportunities in metro D.C. is a likely factor in attracting Black college graduates to the area.

The strength of the 2023 labor market and rise in employment among Black Americans also contributed to the growth in median Black household income. As shown in Figure C, while overall real median household income declined 1.1% between 2019 and 2023, Black median household income grew by 2.8%. The spike in inflation during this period generally muted real income growth; however, increased employment of Black workers managed to counteract the negative impact of inflation on income (Moore and Maye 2023). Black median income growth also outpaced total income growth in six of the 10 observed metro areas—Miami, Atlanta, Chicago, Detroit, Philadelphia, and Dallas. In places where real incomes declined, the decline was smaller among Black Americans.

Figure C

Echoes of the Great Migration

Across all the observed metro areas, there is a clear distinction in the average economic status of Black Americans in the principal city compared with the broader metro area, which includes surrounding suburbs. We characterize these consistent place-based differences as echoes of the Great Migration. One of the factors contributing to these differences was “white flight”—the mass relocation of white people from urban centers to suburbs in response to the rising Black population in cities during the Great Migration. More than just a demographic shift, white flight initiated a draining of economic resources away from cities that continued as more affluent Black families moved to suburbs following the passage and enforcement of fair housing laws.

Across all 10 metro areas, Black unemployment was higher in principal cities compared with the broader metropolitan statistical area (MSA) and the state. Referring again to Figure A, in 2023, Black unemployment in the city of Atlanta (8.4%) was 2.8 percentage points higher than metro Atlanta where Black unemployment was lowest and closest to the overall national average. Similarly, the Black unemployment rate was more than 3 percentage points higher in the cities of Washington, D.C. (9.9%) and Miami (9.7%), relative to the respective metro areas. In Chicago (12.3%) and Detroit (11.7%), Black unemployment was nearly 2 percentage points above metro area rates that were already at least 2 percentage points above the Black national average. Recession-level Black unemployment rates in the Midwestern cities of Chicago and Detroit are also reflected at the state level for Illinois and Michigan. For Detroit, in particular, a second wave of white flight followed the post-1980s decline in manufacturing jobs and union density, once critical sources of Black economic mobility in the region (Scott et al. 2022). 

Similarly, Black median household income was substantially lower in principal cities than the metro area and the state. Figure B shows that across all 10 metro areas, Black median household income was at least $6,400 lower in the principal city than in the metro area. The largest gap was in the D.C. metro area, where there was a difference of nearly $30,000 between Black median household income in the principal city of Washington, D.C., and the broader metro area. In other metro areas with relatively high Black median incomes, like metro Atlanta and Dallas, the difference was $17,066 and $14,849, respectively. However, even in the Detroit metro area where Black incomes were lowest, there was a gap of more than $10,000 between households in the principal city and those in the broader metro area.

Federal grants are critical to filling resource gaps in urban areas

Federal grants are critical to filling the resource gaps in principal cities since those funds are often directed toward poorly resourced communities. Table 1 provides a summary of federal grant dollars flowing to each city in recent years based on data available at USAspending.gov.3 The grant amounts include funds from block, formula, project, and cooperative agreement grant obligations, and encompass COVID-19-related obligations from the American Recovery Plan Act.

As shown in Table 1, D.C. and New York received the most in federal grant funds (an annual average of more than $6 billion each over fiscal years 2022–2024) followed by Atlanta. However, when adjusted for population size, D.C. and Atlanta had the highest per capita averages ($9,158 and $6,769 per person, respectively).

Although these cities anchor metro areas with some of the highest Black median household incomes in the nation, federal grant funds are directed toward the needs of less advantaged residents. For example, over the last three years, Atlanta’s largest federal grants were from the Department of Education to support students from low-income families in Title I schools. The largest federal grants to Washington, D.C., were from the Environmental Protection Agency, authorized through the Inflation Reduction Act to reduce greenhouse gas emissions and other pollutants and to bring green projects to low-income and disadvantaged communities. Most of the federal grant dollars going to the city of New York were from the Department of Housing and Urban Development (HUD) to support public housing.

The Department of Health and Human Services (HHS) was a major source of federal grants awarded in nine of the 10 cities. While the agency is most often associated with Medicaid funding for states, HHS funds programs like Head Start, HIV emergency relief, cancer treatment, and children’s hospitals at the city level. Across all 10 cities, the Departments of HHS, HUD, and Transportation were commonly among the top three awarding agencies, representing critical investments in health and well-being, housing, and transportation infrastructure in urban areas.

Table 1

However, due to the upside-down priorities of the current Congress, many federal investments in low-income and working-class communities have been cut to give tax cuts that overwhelmingly benefit the wealthy. In July 2025, Congress passed the Republican-led Budget Reconciliation Bill (or H.R. 1) which guts Medicaid and slashes the Supplemental Nutrition Assistance Program (SNAP), while also eliminating clean energy tax credits established under the Inflation Reduction Act, potentially putting over half a million jobs at risk (Seeburger et al. 2025). The bill results in 16 million fewer people having health coverage through 2034 and places approximately 11 million individuals at risk of losing SNAP benefits. Medicaid cuts alone could depress local spending enough to force the loss of 850,000 jobs (Bivens 2025). Overall, the Congressional Budget Office estimates that annual income for households in the lowest decile would decline by about $1,600—highlighting the devastating impact this bill will have on vulnerable families and the added strain it would place on state and local budgets (CBO 2025).

The city of Washington, D.C., was placed in a uniquely precarious position when the House’s reconciliation bill reverted D.C. to its 2024 budget. That decision slashed the city’s 2025 budget by more than $1 billion, an impossible deficit to close without laying off many city employees and severely cutting public programs and services. At of the time of this report’s publication, the House had yet to vote on an unanimously passed Senate fix that would reverse the budget cuts, needlessly placing the city’s budget in limbo. In response to House’s inaction, the mayor of D.C. proposed a 2025 supplemental budget that cuts services and freezes hiring to cover the budget gap while avoiding layoffs. Combined with federal job cuts, these actions represent a major blow to the area’s economic base and fiscal autonomy that would be especially tragic for Black Americans across class lines in the D.C. metro area.

Federal jobs cuts threaten relative economic security for the Black middle class

For Black Americans, public-sector employment has historically been a pathway to better, more equitable job opportunities. Through executive actions and legislation introduced in the 1960s and 1970s, the federal government once led in adopting anti-discrimination and affirmative action practices that increased the number of Black workers in the federal government. In the decades that followed, federal jobs have provided stable employment, excellent benefits, and opportunities for career advancement that supported a robust Black middle class. Public-sector collective bargaining has also helped to maintain the quality of these jobs through labor contracts that foster transparency through clearly defined policies and pay structures. This plays a critical role in reducing discrimination and providing workers with critical protections and recourse against other forms of exploitation or mistreatment.

That history stands in sharp contrast to the Trump administration’s efforts to dismantle the public sector, beginning with workers in DEI departments within federal agencies. Trump’s attacks on the federal workforce also include attempts to limit the approval of collective bargaining agreements with federal workers. The targets of such actions include skilled and often highly educated Black workers who typically experience less employment volatility, even during economic downturns. Nationally, Black federal workers average 12.3 years of service and 45.3% hold at least a bachelor’s degree (compared with 26.2% overall) (Maye and Marvin 2025).

While federal jobs losses will obviously have an impact in the D.C. metro area, over 90% of federal workers are employed outside the nation’s capital (McNicholas and Oakford 2025). The ripple effects from large-scale job cuts are expected to show up in higher unemployment and the disruption of critical public services and government functions throughout the nation. Table 2 shows the number of federal workers who live in each of the 10 metro areas, as well as the metro’s share of total federal jobs in the state. For metro areas that cross state lines, including metro D.C., Chicago, New York, and Philadelphia, we calculate metro area jobs as a share of the combined state totals. Over 300,000 federal workers reside in the D.C. metro area, accounting for 60% of all federal workers in the District of Columbia and surrounding states of Virginia, Maryland, and West Virginia. The second largest number of federal workers (over 100,000) are in the New York metro area, representing 63% of all federal workers in New York and New Jersey. Among the single state metro areas, Atlanta is home to over half (51%) of Georgia’s federal workforce and 47% of Michigan’s federal workers are in metro Detroit.

Table 2

While metro-level federal employment numbers by race are unavailable, EPI analysis of state-level data from the Office of Personnel Management (OPM) reveals that 43.8% of Georgia’s federal workers are Black—the largest share in the country (Wilson 2025). The District of Columbia, Maryland, and Virginia each have larger numbers of federal workers than Georgia, and Black workers are just over one-fourth of the federal workforce in each those states—28.8% in D.C., 27.9% in Maryland, and 26% in Virginia.

Between January and July of 2025, BLS reported a loss of 84,000 net federal jobs but the full impact and consequences of those job losses are yet to be revealed. Though thousands of fired federal workers were reinstated by court orders in February 2025, the Supreme Court later sided with the Trump administration when it lifted a lower court’s block on mass federal layoffs, clearing the way for the Trump administration to proceed with planned large-scale cuts to the federal workforce. However, DOGE’s lack of transparency and the Trump administration’s broader data erasure efforts make it difficult to keep track of whether job cuts fall disproportionately on certain groups of workers.4

Troubling changes at the EEOC stifle equity and would be harmful to economic growth

As a large independent federal agency, the Equal Employment Opportunity Commission (EEOC) is relatively small compared with many cabinet level agencies experiencing job cuts. Headquartered in Washington, D.C., the EEOC operates 53 district and field offices across the country,5 including locations in each of our 10 featured cities with large Black populations. For 60 years, the EEOC has been integral to the enforcement of U.S. anti-discrimination laws—efforts that helped reduce employment discrimination and boost average living standards by an estimated $493 to $1,233 per person since 1960 (Maye and Wilson 2025). However, troubling changes to the structure and priorities of the agency paralyze some of the commission’s key functions and weaken enforcement against racial and gender discrimination—the most common types of discrimination claims filed (Mark, Gurley, and Rein 2025).

Instead, the Trump administration has redirected the EEOC’s priorities to focus more on investigating so-called DEI-motivated race and sex discrimination and anti-American national origin bias and discrimination (DOJ 2025; EEOC 2025). Trump also issued an executive order designed to end the use of disparate impact liability, a legal standard that works to prevent otherwise “race-neutral” policies and practices from perpetuating racial inequities (EPI 2025b). This restructuring of priorities threatens to turn the mission of the EEOC on its head by framing equity efforts intended to remedy decades of documented employment discrimination as discriminatory.

Just as the presence of EEOC offices in these cities signaled the federal government’s nationwide vigilance over employment discrimination, efforts to undermine the agency signal that employment discrimination—particularly against racial, ethnic, sexual, or religious minorities—will go unchecked. The impact of those changes extends beyond the millions of Black Americans working in and around these 10 cities alone and erodes workplace equity writ large.

State and local policy levers

As the Trump administration pushes the federal government toward a more anti-worker and anti-equity stance, decisions made by state and local policymakers will determine what kinds of protections workers in their states and cities will retain. Table 3 presents a sample of state and local policy positions related to workers’ rights for the ten metro areas featured in this analysis. These positions represent the relative progressivity of those state and local governments which could indicate their propensity to provide some buffer against harmful federal actions that raise the risk of recession, weaken labor standards, and exacerbate racial inequities. These policies include unemployment insurance (UI), minimum wage, paid leave, state preemption of local minimum wage or paid leave policies, and right-to-work laws. As a measure of the likelihood that state and local leaders will fight to maintain or strengthen equity efforts, we also include the number of Black mayors elected in each city and the existence of state or local reparations initiatives.

A basic scan of state and local policies reveals that while there is some variation in the generosity of UI benefits across states, the need for expanded federal support will once again be essential for recovery from the next recession. The scan also shows that local leaders in red states face state-imposed obstacles to passing progressive economic and racial justice policies.  

Table 3

Unemployment insurance

Unemployment insurance benefits are among the most efficient sources of support to families and the economy during a recession. Since they are targeted at individuals whose income falls due to a job loss, UI benefits provide direct income support to eligible unemployed workers while also helping to stabilize aggregate demand, the largest driver of economic growth. Estimates suggest that each dollar in UI benefits can generate nearly $2 in local spending (Evermore 2024). Despite the efficiency of UI benefits, they are often the target of austerity politics fueled by exaggerated and frequently debunked claims that overly generous benefits suppress employment (Martinez Hickey and Cooper 2021). 

While adequate federal action and support for expanding UI during a recession are critical to a quick recovery, state policymakers have some flexibility in determining how their UI programs are structured and resisting the austerity impulse. As a joint state and federal program, each state can adjust its own eligibility requirements, length of time for available benefits, and maximum weekly benefits in coordination with federal guidelines. Among the states represented in Table 3, Florida and Michigan are the only two that currently cap the number of weeks benefits can be received at less than 26 weeks. However, the maximum weekly benefit for unemployed individuals varies from a high of $605 per week in Pennsylvania (Philadelphia) to a low of $365 per week in Georgia (Atlanta).

The COVID-19 pandemic revealed the potential for major federal reforms to boost UI as a macroeconomic stabilizer by enhancing the duration, generosity, and eligibility of UI benefits (Bivens and Banerjee 2021). The pandemic also exposed administrative and fiscal inadequacies in state UI systems. Federal funds were allocated by the American Rescue Plan Act (ARPA) to improve UI systems administration, prevent fraud, and increase equitable access (DOL n.d.). However, few states took steps to strengthen severely underfunded state UI systems long term by increasing their taxable wage base (Sawo and Sherer 2022). UI reform advocates recommend increasing the taxable wage base to half of the taxable maximum for Social Security (Bivens et al. 2021). The increase would result in employers paying state unemployment taxes on a larger percentage of higher wage earners’ pay, generating more revenue and sustaining more fairness, equity, and administrative efficiency over time. Among the states considered, only New York and Illinois have a taxable wage base above $10,000, but still far below the much higher recommended base of $88,500 needed to address underfunding.6

In red states, a city’s ability to enact pro-worker policies is often at the mercy of state preemption

Several states and localities across the country have established minimum wage ordinances that exceed the federal standard. Since the federal minimum wage has remained stuck at $7.25 for over 15 years, failing to keep up with rising costs and inflation, this is a critical policy lever for supporting workers and their families’ right to a livable wage (Payne-Patterson and Maye 2023). Rasing the minimum wage supports all workers, but especially Black workers who are overrepresented in low-wage occupations.

Currently, 19 states and Washington, D.C., have passed laws raising their own minimum wage to at least $15 an hour by 2027, including several cities listed in Table 3 with local minimum wages well above the federal minimum (Hickey 2024; EPI 2025a). Washington, D.C., New York, Los Angeles, and Chicago all have a minimum wage standard of at least $15 an hour and Detroit’s minimum wage increased to $12.48 in 2025.

Sadly, four cities with large Black populations—Atlanta, Dallas, Houston, and Philadelphia—have not raised their minimum wage above the federal level. In June, the Pennsylvania state House passed a bill that would raise Philadelphia’s minimum wage to $15 an hour after years of failed attempts to increase the state’s minimum wage to that level (Huangpu 2025). The House proposal now awaits approval by the state Senate. For relatively progressive cities that also happen to be in red states, state preemption laws are a major barrier to passing a higher local minimum wage. In Atlanta, workers not covered by the Fair Labor Standards Act are paid a minimum of $5.15 an hour—$2.10 below the already insufficient federal minimum wage (GDOL n.d.). While local governments are prohibited in establishing a higher city-wide minimum wage, Dallas, Houston, and Atlanta have each passed increases for city, county, or contract workers (Cooper 2024; Barrera and Heilman 2025). Apart from preemption, right-to-work laws in these states also present barriers that limit workers’ collective bargaining rights, resulting in lower wages and benefits for all workers.

While raising the minimum wage can raise living standards for low-wage hourly workers, paid family leave enables workers to avoid the difficult tradeoff between income stability and caring for family. There is no federal law that guarantees paid family or medical leave to workers; up to 12 weeks of unpaid leave are available to eligible employees under the Family and Medical Leave Act (FMLA). However, as of 2025, 13 states and Washington, D.C., have passed their own paid family leave laws (Williamson 2024). Of the states listed in Table 3, only California, New York, and the District of Columbia currently have paid leave policies on the books. In D.C. and New York, eligible employees receive up to 12 weeks of paid leave (DCPFL n.d., NYSPFL n.d.). In California, eligible employees receive up to eight weeks of paid time off (EDD n.d.). All three policies allow workers to use this leave for caring for a loved one, bonding with a child, or military assistance. In New York, employees taking paid family leave receive 67% of their average weekly wage, while in California, workers can receive about 70–90% of wages earned five to 18 months before the claim start date. D.C. Paid Family Leave provides wage replacement of 90% of wages up to 1.5 times D.C.’s minimum wage and 50% of wages above 1.5 times D.C.’s minimum wage (DCPFL n.d.).

Will local steps toward racial reckoning withstand the rising tide of federal and state anti-equity backlash?

Every city and town in the United States has its own complicated racial history to reckon with. That history is infused in local policy and politics and shapes social and economic outcomes. As is true at the national level, decisions made by local elected leaders can either widen or narrow racial disparities. Leadership also reflects and sets the tone for how a city acknowledges, confronts, and seeks to resolve current and historic racial injustice. As measures of perceived racial progressivity, we consider the number of Black mayors elected in the principal city for each metro area and whether any local reparations initiatives have been introduced since 2020. While these are admittedly imperfect metrics, we interpret them as signals of the local political will to advance racial equity and defend current efforts. However, it is uncertain how much local efforts will be jeopardized by legal challenges triggered by aggressive federal and state anti-equity policies.

Table 3 shows that among the 10 cities observed, all except Miami have elected at least two Black mayors. The cities with the longest history of Black leadership are Washington, D.C., and Atlanta, having had seven and six Black mayors, respectively. Five Black Americans have served as mayor of Detroit. Since Black Americans are the largest demographic group in each of these cities, the larger number of Black mayors elected in these cities reflects city demographics and perhaps the degree of influence Black Americans wield in local elections. A more comprehensive analysis of city management and the policy priorities of individual mayors would be needed to assess their direct impact on Black economic outcomes or racial equity.

While little progress has been made to advance the issue of reparations at the federal level, since 2020, several state and local governments have taken initiative in addressing their own histories of racial and economic injustice against Black Americans. Reparations initiatives exist in all except the three cities in red states whose governors have aggressively pushed anti-DEI legislation: Miami in Florida, and Dallas and Houston in Texas. In most places where a reparations initiative exists, activity has been at the city or county level. However, both city- and state-level initiatives exist in California and New York. Current state and local reparations efforts range from the appointment of a task force to study the issue, to exploring plan options, approving legislation, and implementing a plan. While there are open questions about whether local plans are truly reparative or will have any measurable economic effect on closing the racial wealth gap, they are at least a signal of willingness to confront and seriously consider government accountability for eliminating racial inequities (Moore 2023).7

Conclusion

The strong and stable economy Trump inherited withstood months of his administration’s harmful and chaotic policy actions before clear signs of a softening labor market became evident in the July jobs report. Large downward revisions to May and June payroll employment estimates signaled a weaker labor market than originally reported, bringing average three-month job growth down to just 35,000 net new jobs compared with 127,000 over the preceding three months. Rather than taking this sobering news as a sign that he should reconsider the current policy path, Trump misrepresented the news as a politically motivated personal attack and fired BLS Commissioner Erika McEntarfer. Such careless actions unjustifiably erode confidence in one of the world’s most respected statistical agencies and endangers sound economic decision-making.

If the Trump administration and Congress continue along the current path, there is a very real risk of a recession in the coming months—and a lot at stake for Black Americans who typically suffer higher rates of unemployment and take longer to recover lost jobs and income from a downturn. In recent years there have been economic gains that should be protected and expanded. Five metro areas in this analysis had Black unemployment rates below the national average in 2023 and the median Black household income was above the national median in eight metros. At the same time, there is evidence of persistent inequities and economic hardship that demand a commitment to long-term solutions and investment in underserved communities. Two metro areas were below national measures of Black unemployment and income, but across all 10 metro areas, principal city residents had higher unemployment and lower incomes compared with the broader metro area which includes surrounding suburbs. Trump’s anti-equity, anti-worker agenda undermines both of those objectives by decimating the federal workforce and attacking public sector unions; cutting the federal budget for Medicaid, SNAP, and other programs that benefit low-income families; weaponizing civil rights enforcement to discourage diversity, equity and inclusion; and weakening core labor standards and protections.

State and local governments have some policy levers at their disposal for improving worker protections, but the effect those policies can have on the economic well-being of Black Americans varies by place, and in some cases is conditional on federal or state actions. For example, while cities and states have some capacity to increase their minimum wage or pass paid leave policies, preemption is a major barrier for local leaders seeking to pursue more progressive policies in red states. The law allows states some flexibility to adjust the duration and amount of unemployment insurance benefits, one of the most efficient sources of income support during a recession. Yet severe underfunding of state systems due to a far too low state taxable wage base starves their capacity to make substantial improvements in the fairness, equity, or generosity of benefits without federal funding. Moreover, in a recession, there is little any state can do to expand benefits and speed recovery without increased federal support—a step we can’t assume to be a priority of the current Congress or president. Finally, while many of cities we observe could be considered more racially progressive than the country as a whole, federally led anti-DEI backlash raises the possibility of legal challenges against local policies in support of equity and racial justice.

Black America is not a monolith. That statement is an assertion of the right to self-determination and individual expression that racism denies Black Americans. It is also a reflection of the varied experiences shaped by differences in local policy, economic conditions, political influence, and culture. Still, history shows that the pursuit of collective freedom, justice, and equity for Black Americans has always required decisive national actions that raise the standards for fair and equal treatment of all people in this country. The Trump administration’s denial of that history and lowering of those standards is not just several steps backwards for Black Americans, but moves all of the United States in the wrong direction.

Notes

1. A metro area is a region that includes a principal city and surrounding cities and towns with economic and social ties to the urban core.

2. The labor market statistics produced by BLS are based on data collected in the Current Population Survey (CPS). CPS interviews are conducted in a single designated week each month and annual averages align with the calendar year, whereas respondents answer the ACS at times that vary throughout the month and year and annual figures are averaged over the prior 12 months.

3. USAspending.gov is the official open data source of federal spending information, including information about federal awards such as contracts, grants, and loans. Since annual grant totals can change as data are updated on a rolling basis, we use a three-year average to minimize the sometimes substantial effect updates can have on a single year’s grant total. A downloaded transaction summary as it existed at the time of our analysis is available upon request.

4. The OPM data used to report the share of Black federal workers are no longer publicly available.

5. Workers can call or visit EEOC field offices to ask questions about potential employment discrimination or to directly file an individual complaint. Field offices may also recommend charges for EEOC Commissioners to pursue against specific employers.

6. The $88,500 corresponds to half of the 2025 taxable wage limit for Social Security, which was $176,100, up from $168,600 in 2024.

7. In May 2025, FirstRepair and Decolonizing Wealth Project launched a mapping tool that documents state and local reparations initiatives across the United States. See: FirstRepair and Decolonizing Wealth Project, “Mapping the U.S. Reparations Movement” (web page), https://www.reparationsresources.com/.

References

Barrera, Daniela, and Greg Heilman. 2025. “New Minimum Wage in Texas for 2025: These Cities Will See an Increase.” Diario AS, January 3, 2025.

Bivens, Josh. 2025. “House Budget Bill Would Kick 15 Million People Off Health Insurance and Damage Local Economies.” Working Economics Blog (Economic Policy Institute), June 3, 2025.

Bivens, Josh, and Asha Banerjee. 2021. How to Boost Unemployment Insurance as a Macroeconomic Stabilizer: Lessons from the 2020 Pandemic Programs. Economic Policy Institute, October 2021.

Bivens, Josh, Melissa Boteach, Rachel Deutsch, Francisco Diez, Rebecca Dixon, Brian Galle, Alix Gould-Werth, Nicole Marquez, Lily Roberts, Heidi Shierholz, William Spriggs, and Andrew Stettner. 2021. “Section 2. Financing.” In Reforming Unemployment Insurance: Stabilizing a System in Crisis and Laying the Foundation for Equity. A joint report of the Center for American Progress, Center for Popular Democracy, Economic Policy Institute, Groundwork Collaborative, National Employment Law Project, National Women’s Law Center, and Washington Center for Equitable Growth. June 2021.

Cid-Martinez, Ismael, Adewale A. Maye, and Stevie Marvin. 2025. “Workers of Color Made Historic Gains Over the Last Five Years, but Trump’s Anti-Worker and Anti-Equity Agenda Threatens To Reverse This Progress.” Working Economics Blog (Economic Policy Institute), March 27, 2025.

Congressional Budget Office (CBO). 2025. Letter to U.S. House of Representatives Members Brendan F. Boyle and Hakeem Jeffries. June 12, 2025.

Cooper, Tori. 2024. “Atlanta Mayor Signs Legislation to Increase City Employee Pay.” Atlanta News First, August 20, 2024.

DC Paid Family Leave (DCPFL) (website). n.d. Accessed June 17, 2025.

Department of Labor (DOL). n.d. “American Rescue Plan Act UI Modernization Grants Map” (web page). Accessed June 13, 2025.

Department of Justice (DOJ). 2025. “EEOC and Justice Department Warn Against Unlawful DEI-Related Discrimination” (press release). March 19, 2025.

Economic Policy Institute (EPI). 2025a. “Minimum Wage Tracker” (web page). Last modified March 1, 2025.

Economic Policy Institute (EPI). 2025b. President Trump Moves To End Disparate Impact Liability That Protects People from Discrimination. April 2025.

Employment Development Department (EDD). n.d. “Paid Family Leave Benefits and Payments FAQs” (web page). Accessed June 13, 2025. 

Equal Employment Opportunity Commission (EEOC). 2025. “EEOC Acting Chair Vows to Protect American Workers from Anti-American Bias” (press release). February 19, 2025.

Evermore, Michele. 2024. “Unemployment Benefits for Striking Workers Would Have Low Costs and High Rewards.” Commentary (The Century Foundation), February 28, 2024.

FirstRepair and Decolonizing Wealth Project. 2025. “Mapping the U.S. Reparations Movement” (web page). Accessed June 13, 2025.

Georgia Department of Labor (GDOL). n.d. “Minimum Wage” (web page). Accessed June 13, 2025.

Hickey, Sebastian Martinez. 2024. “Nearly Half of U.S Workers Will Live in States With at Least a $15 Minimum Wage by 2027.” Working Economics Blog (Economic Policy Institute), December 9, 2024.

Hickey, Sebastian Martinez, and David Cooper. 2021. “Cutting Unemployment Insurance Benefits Did Not Boost Job Growth.” Working Economics Blog (Economic Policy Institute), August 24, 2021.

Huangpu, Kate. 2025. “Minimum Wage Would Be $15 in Big Counties, $12 in Smaller Ones Under Novel Bill Passed by Pa. House.” Spotlight PA, June 11, 2025.

Mark, Julian, Lauren Kaori Gurley, and Lisa Rein. 2025. “Trump Moves To Fire Members of EEOC and NLRB, Breaking With Precedent.” Washington Post, January 28, 2025. 

Maye, Adewale A., and Stevie Marvin. 2025. “Trump Attacks on Federal Agencies Have Steep Implications for Black Workers.” Working Economics Blog (Economic Policy Institute), April 10, 2025.

Maye, Adewale A., and Valerie Wilson. 2025. “Trump Is Making it Easier for Employers to Discriminate. This Stifles Equity and Hurts Economic Growth.” Working Economics Blog (Economic Policy Institute), May 27, 2025.

McNicholas, Celine, and Patrick Oakford. 2025. “A Snapshot of the Federal Workforce That Is Now Under Attack from the Trump Administration.” Working Economics Blog (Economic Policy Institute), February 21, 2025.

McNicholas, Celine, Samantha Sanders, Josh Bivens, Margaret Poydock, and Daniel Costa. 2025. 100 Ways Trump Has Hurt Workers in His First 100 Days. Economic Policy Institute, April 2025.

Moore, Kyle K. 2023. “Five Principles for Making State and Local Reparations Plans Reparative.” Working Economics Blog (Economic Policy Institute), February 15, 2023.

Moore, Kyle K., and Adewale A. Maye. 2023. “Despite a Strong Labor Market, the Choice to Allow Pandemic-Era Public Assistance Programs to Expire Increased Poverty Across All Racial Groups in 2022.” Working Economics Blog (Economic Policy Institute), September 18, 2023.

New York State Paid Family Leave (NYSPFL). n.d. “New York Paid Family Leave Updates for 2025” (web page). Accessed June 13, 2025.

Payne-Patterson, Jasmine, and Adewale A. Maye. 2023. “A History of the Federal Minimum Wage.” Working Economics Blog (Economic Policy Institute), August 31, 2023.

Sawo, Marokey, and Jennifer Sherer. 2022. “Strong and Equitable Unemployment Insurance Systems Require Broadening the UI Tax Base.” Working Economics Blog (Economic Policy Institute), May 6, 2022.

Scott, Robert E., Valerie Wilson, Jori Kandra, and Daniel Perez. 2022. Botched Policy Responses to Globalization Have Decimated Manufacturing Employment with Often Overlooked Costs for Black, Brown, and Other Workers of Color. Economic Policy Institute, January 2022.

Seeberger, Colin, Andrea Ducas, Lily Roberts, Shannon Baker-Branstetter, Kennedy Andara, and Kyle Ross. 2025. “The Devastating Harms of House Republicans’ Big, ‘Beautiful’ Bill by State and Congressional District.” Center for American Progress, May 2025.

Williamson, Molly Weston. 2024. The State of Paid Family and Medical Leave in the U.S. in 2024 (fact sheet). Center for American Progress, January 2024.

Wilson, Valerie. 2025. Black Federal Workers by State (fact sheet). Economic Policy Institute, April 2025.

Long-standing U.S. worker rights and protections are under acute threat. These include attempts to roll back standards that set a national floor for minimum wages, health and safety, nondiscrimination, unemployment insurance, and other rights and protections long taken for granted in most U.S. workplaces.

Jump to the state solutions

Under the second Trump administration, intense attacks have proliferated by the day and taken many forms. Cuts to federal agency funding and mass firings of federal civil servants—targeting agencies like the Equal Employment Opportunity Commission, the CDC’s National Institute of Occupational Safety and Health, the National Labor Relations Board, and U.S. Department of Labor units like the Occupational Safety and Health Administration and the Wage and Hour Division—have quickly imperiled the federal government’s capacity to ensure U.S. workers get paid what they’re owed, stay safe at work, have the freedom to form a union, and work in environments free from discrimination. Simultaneously, executive actions have directly targeted rights of workers for elimination. Examples include decisions to lower wages of federal contractors; strip union rights of federal employees; revoke work authorization for hundreds of thousands of migrant workers; and block the implementation of new standards to safeguard workers’ overtime wages, freedom to change jobs, and right to organize. Most recently, the administration has  taken initial steps to roll back scores of wage and hour and health and safety standards via proposed regulatory changes.

At the same time, Trump’s escalating and often lawless attacks on migrant workers are fostering a climate of fear that will worsen workplace conditions across the country and make it harder for workers to report labor abuses. The administration has also cancelled programs that protected workers from immigration-related retaliation when speaking up about labor violations or that helped prevent exploitative, illegal forms of child labor by allowing migrant youth fleeing neglect or abuse to petition for legal work authorization and a pathway to citizenship.

Trump’s attacks on workers run parallel to industry-backed attempts to ratchet down state labor standards while building pressure to erode federal standards for the whole country. For example, lawmakers in Ohio have repeatedly paired legislation to extend hours children can be scheduled to work on school nights (contradicting current federal guidelines) with concurrent resolutions calling on Congress to “change [the] Fair Labor Standards Act” to bring federal standards in line with weaker state rules. Project 2025, the policy roadmap closely followed so far by the second Trump administration, proposes allowing states to “opt out” of federal minimum wage, overtime, and child labor standards. If pursued, this drastic step would put workers at risk of extreme forms of exploitation.

The crisis calls for urgent action. At a minimum, states must be equipped to maintain and enforce basic protections should at-risk federal standards disappear. The crisis also presents opportunities for states to do much more to:

• remedy longstanding gaps and exclusions in weak or outdated labor and employment laws;
• advance new policies that address the pressing challenges of eroding worker power, growing income inequality, persistent racial and gender wage gaps, and declining job quality; and
• position states over the long term to assume more expansive, effective roles in enacting and enforcing key protections that form the bedrock of an economy that works for all.

Americans often tell pollsters that they think the economy is in recession, but this seems like a shorthanded way to express their frustration with the state of economic rewards in this country. And it is true that the U.S. economy—the richest in the history of the world—does a bad job of translating overall growth into true economic security for most families. Contrary to popular opinion, though, recessions rarely occur, and when they do, they make economic outcomes far worse and notably increase deprivation for typical families.

In short, the question of whether a recession is coming is not driven by political point-scoring, it cannot be assessed by quirky responses to poll questions, and it has dire and significant consequences for the material circumstances of tens of millions of American families.

Why have people been talking more about a possible recession lately?

Summary: Despite inheriting a strong and stable economy, the Trump administration has made policy announcements and commitments that are highly likely to cause a recession over the next year, unless they are reversed.

Read the full answer

Recent concerns about recession are 100% driven by poor policy decisions from the Trump administration. The macroeconomy was in an extraordinarily strong and stable state when it was handed off to the Trump administration. The historically high and broad tariffs the Trump administration has repeatedly threatened since early March would, by themselves, pose a recessionary threat to the economy. The chaotic way the administration has rolled out, retracted, changed, paused, and re-upped the tariffs have made things even worse by creating mammoth economic uncertainty as well, which nearly all economic observers think will lead to sharp contractions in several kinds of economic activity.

Figure A shows Google search trends for recessions, along with the dates of various tariff announcements.

Figure A

The International Monetary Fund said the following about global growth prospects in January 2025 (before President Trump’s inauguration):

The forecast for 2025 is broadly unchanged from that in the October 2024 World Economic Outlook (WEO), primarily on account of an upward revision in the United States offsetting downward revisions in other major economies…. Upside risks could lift already-robust growth in the United States in the short run, whereas risks in other countries are on the downside amid elevated policy uncertainty.

In April of 2025, a revision to these growth forecasts noted the following about the negative effects that the new tariffs would have:

Since the release of the January 2025 WEO Update, a series of new tariff measures by the United States and countermeasures by its trading partners have been announced and implemented, ending up in near-universal US tariffs on April 2 and bringing effective tariff rates to levels not seen in a century (Figure ES.1). This on its own is a major negative shock to growth. The unpredictability with which these measures have been unfolding also has a negative impact on economic activity and the outlook and, at the same time, makes it more difficult than usual to make assumptions that would constitute a basis for an internally consistent and timely set of projections.

Further, on April 9, the Goldman Sachs macroeconomic forecasting team moved their baseline scenario for the next year to recession, based on announcements of the “Liberation Day” tariffs. When the Trump administration announced a pause on tariffs, the forecast changed back to just under 50% chance of recession.

In short, there is universal agreement that the Trump tariff policy is bad for growth in substance and in implementation, and that this policy is driving increased risk of recession.

On top of the botched tariff policy, the other big threat to growth in the near term is a similarly chaotic effort to destroy capacity in the federal government. The administration has rolled back or ended federal employment and grants in numerous extralegal ways. These cutbacks could eventually be large enough to weigh on growth in the short term, and they will absolutely reduce longer-run growth as key public goods and services that complement private-sector growth-generating activities are no longer provided. Further, many of the key functions being hamstrung by recent cutbacks involve surveillance of potential economic risks—either financial, epidemiological, or climate-related. Impaired surveillance could well mean future risks (say of cascading bank failures or of another pandemic) wouldn’t be anticipated, and there wouldn’t be sufficient time to mount a strategic response, further harming growth.

All the uncertainty associated with bad policy implemented chaotically has led to the highest economic policy uncertainty readings since the beginning of the COVID-19 pandemic. This uncertainty is poison for all sorts of high-stakes spending decisions from businesses and households, and so these decisions will be deferred, and economic activity will begin contracting.

So far, the core data normally used to declare recessions have not signaled that a recession has begun. This could take a number of months (see answers to the questions below that talk a bit more about this data). But other data, often sentiment-based, is strongly signaling that a recession is very likely.

Are standard recession indicators clearly signaling an imminent economic contraction?

Summary: Not as of May 2025. Standard recession indicators do not look strongly contractionary at the moment. Since January 2025 there has been more weakening than strengthening in these indicators, but by themselves, they are not clearly showing signs of recession.

Read the full answer

As of May 2025 these standard indicators are not strongly signaling an imminent contraction. Table 1 shows a number of indicators used by the National Bureau of Economic Research to define recessions. It shows how these indicators slowed in the six months before the last two recessions before COVID-19 and then compares their pace of growth since January 2025 relative to their pace in 2024.

Table 1

In the last two nonpandemic recessions, growth in nearly all indicators slowed sharply in the six months before a recession hit. Since January 2025, of the 10 indicators for which data are available, growth has slowed in six and has not improved at all relative to 2024 for two indicators. Two indicators have seen faster growth so far in 2025 than in 2024.

So far, while more indicators are slowing in this table than not, without other information (discussed in more detail in the following question), this table would not generally raise huge concerns about a coming recession. But these indicators certainly bear watching.

Another commonly referenced recession predictor is the “Sahm rule” (when the rolling three-month average of the unemployment rate exceeds the lowest point this measure reached over the past 12 months by 0.5 percentage points, this often predicts a recession). The Sahm rule has already triggered one “false positive” in the past couple of years, but is not signaling a recession now (see Figure B for the Sahm indicator and thresholds).

Figure B

Do recessions clearly increase poverty and other measures of economic suffering?

Summary: Yes, recessions are strongly associated with higher poverty and greater material deprivation. During the pandemic recession and early recovery, government support was so unprecedentedly generous that the poverty increases spurred by the recession were swamped by poverty declines driven by government aid. But that recession was a clear outlier.

Read the full answer

The labor market is the main source of income for low-income families, and higher unemployment during a recession causes reductions in annual earnings, pushing more families below poverty income thresholds.

Figure C uses annual state-level data to show that higher unemployment rates are associated with higher poverty rates. In particular, a one percentage point increase in unemployment typically leads to a 0.6 percentage point increase in the standard poverty rate, or about 2.1 million additional people in poverty according to recent data.2

However, poverty rates are less likely to rise when there is stronger fiscal support to combat a recession, particularly when the fiscal support is targeted directly at lower-income households. This happened most recently during the COVID-19-induced recession in 2020 when expanded unemployment benefits, higher child tax credits, cash payments, and low interest rates directly benefited families and kept aggregate demand high. The annual unemployment rate more than doubled between 2019 and 2020, but the standard poverty rate based on pre-tax money income only rose by 1.0 percentage point. The supplemental poverty rate, which includes post-tax income, fell by 3.9 percentage points between 2019 and 2021, and only rose in 2022 after many of the COVID-19-related supports expired. Further, by the end of 2021, unemployment rates nearly returned to pre-recession levels.3

Figure C

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Notes:

2. A regression of state-level official poverty rates on unemployment rates from 1978 through 2023, with state and year fixed effects, weighted with mean state age 16 and over population levels, yields a coefficient of 0.623. In 2023, the poverty rate was 11.1%, and the poverty level was about 36.8 million people, so a 0.623 percentage point increase in poverty is equivalent to about 2.1 million people. Poverty rates, unemployment rates, and civilian population levels are available from the EPI State of Working America Data Library, retrieved May 9, 2025.

3. Official and supplemental poverty rates are available from the EPI State of Working America Data Library, retrieved May 9, 2025.

Who is hurt the most in recessions?

Summary: Workers with the least labor market leverage usually bear the largest costs of a recession. Concretely, this means that employment declines the most for Black and Hispanic workers, younger workers, and workers without a college degree.

Read the full answer

Due to discrimination and other structural inequalities in the labor market, Black and Hispanic unemployment rates are consistently higher than white unemployment rates. Black workers have unemployment rates that are twice as high as their white counterparts, and the 2:1 Black-to-white unemployment rate ratio implies that Black unemployment rates soar during a recession. Figure D shows that in every recession over the last four decades, Black and Hispanic workers have experienced a much larger fall in employment than white workers. During the Great Recession, for example, the Black prime-age employment-to-population ratio (the share of adults between the ages of 25 and 54 with a job) fell by 7.4 percentage points, while the white rate fell by 4.3 percentage points.

Moreover, Black workers experience higher unemployment for a longer period relative to white workers. White unemployment began to fall 19 months after the technical end of the Great Recession in June 2009, but Black unemployment only began falling after 26 months. Relative to their white counterparts, Black workers experienced higher unemployment rates, which have taken longer to fall in every recession since the 1980s. When there is a negative economic shock, Black workers experience larger declines and slower recoveries of prime-age labor force participation and employment rates. In addition, Black workers who remain employed see disproportionately lower wage growth than white workers during periods of higher unemployment.

Figure D

Soft indicators reveal economic weakness

By “soft” indicators, we primarily mean data sources that rely on consumer or business sentiment rather than outcomes. For example, a “soft” measure of consumer strength would be consumer sentiment surveys asking them about their confidence levels, but a “hard” measure of consumer strength would be their actual spending. Other “soft” measures include forecasts that make projections based on past historical relationships. So far, it is these soft indicators that have deteriorated noticeably while most hard indicators have not yet strongly signaled a recession.

The latest New York Federal Reserve survey shows that consumers have more pessimistic expectations about inflation, their households’ financial situation, and particularly unemployment: The probability that unemployment will be higher one year from now hit its highest expected level since the pandemic recession in 2020. The University of Michigan’s consumer confidence surveys also show a worsening of expectations over the next year regarding unemployment and inflation.

In their Manufacturing Business Outlook, the Federal Reserve Bank of Philadelphia reported a deterioration in general activity, new orders, and current shipments in April. This weakness showing up first in the manufacturing sector is ironic given that the Trump administration’s tariff policies are often defended on the grounds that they will help U.S. manufacturing. The Census Bureau’s data on monthly new residential construction also show some softening in the housing market, particularly for single-family housing starts.

Further, the stock market losses have wiped out any gains from the last year, and measures of stock market volatility remain high—reflecting a lack of confidence in the current economic and policy landscape. The Atlanta Federal Reserve’s GDPNow model estimates a 2.5% decline in real GDP for the first quarter of 2025.

Key labor market indicators could begin to show trouble brewing

This economic turmoil has not yet been reflected in top-line labor market data—though they have shown some weakness in federal employment. This week’s releases of JOLTS, UI claims, and the jobs report could begin to indicate widespread economic distress.

The delay in data reporting could be one of the reasons we haven’t seen a pronounced deterioration in this labor market data. The latest JOLTS data are from February, which showed very little change, but the fingerprints of recent policy decisions are visible for the federal workforce. Figure A shows a significant spike in federal layoffs, hitting 22,000 in February. Tomorrow’s JOLTS release will likely show continued weakness among federal workers in March that may begin to be visible in the overall data.

Figure A

The latest jobs report provided data for mid-March and has shown a net loss of 15,000 federal jobs since January. However, this number may have been kept low because many federal workers were put on administrative leave, and those workers remain officially on federal payrolls. I’ll be surprised if more of the widely reported cuts to the federal workforce and federal contractors aren’t visible in the next jobs report on Friday.

The most updated read on the labor market comes from the unemployment insurance (UI) programs. The Department of Labor aggregates state reports of how many workers filed for initial UI claims each week, and how many people received UI benefits for regular state programs and separately for federal employment. The latest data show higher initial and continued UI claims for federal workers than this time last year, consistent with the spike in layoffs from JOLTS and the drop in employment in the payroll data.

The UI claims data also show a spike in regular continued UI claims (not including federal) in D.C. Figure B shows that national UI claims grew 4.7% over the year but grew a whopping 98.3% over the year for D.C. residents, likely reflecting job losses among federal contractors and related sectors.

Figure B

While the fingerprints of recent policy decisions are clearly showing up in the soft data, it may take time for it to hit the overall labor market measures, at least at the national level. Unless there is a dramatic shift in the current policy agenda, we will likely start to see measured weakness in upcoming labor market data in the coming months.

Figure A

Despite the remarkable similarity in unemployment rates shown in Figure A, Black workers in Maryland and Alabama may not be as equally well off as they appear to be. Figure B reveals that between 2018 and 2023, a much larger share of Maryland’s Black population was employed than Alabama’s. In 2023, the employment-to-population ratio (EPOP) in Maryland was 64.6%, compared with just 55.5% in Alabama and 59.6% for the United States as a whole. 

Figure B

If Black unemployment rates are so similar in both states, why are employment-to-population ratios so different? Because of fundamental differences in each state’s approach to social and economic policy. While Alabama adopts the Southern economic development strategy, for example, Maryland does not. This strategy seeks to disempower workers—especially Black and brown workers—to ensure employers can extract their labor for as little compensation as possible. In practice, this translates to higher rates of incarceration in Alabama than in Maryland, especially for Black men. Alabama has no minimum wage, compared with Maryland’s $15 per hour wage floor. Alabama lacks pro-worker, family-supportive labor policies like Maryland’s paid sick days and paid family and medical leave laws. And Alabama underinvests in public services.

Each of these policy decisions limits job opportunities that support a decent standard of living and can lead workers to become discouraged and leave the labor market. Since workers who leave the labor market are no longer counted as unemployed, the Southern economic development strategy may be artificially lowering Alabama’s Black unemployment rate. To underscore how vastly different labor market conditions are for Black workers in two states with similarly low unemployment rates, we compare these components of the Southern economic development strategy in Alabama versus Maryland. 

Alabama incarcerates more of its residents

Figure C shows that Alabamians are incarcerated at a rate that is 1.4 times higher than all Americans and 1.7 times higher than Marylanders.1 This is remarkable given that the United States as a whole already incarcerates its citizens at a rate higher than any country in the world. It is not just that Alabama imprisons more of its residents than Maryland does, Black Alabamians are highly overrepresented in the prison population. 

Figure C

According to data from the Prison Population Initiative, in 2021 just 26% of Alabama’s resident population was Black compared with 43% of its jail population and 53% of its prison population. Maryland also incarcerates Black residents at a disproportionately high rate—Black Marylanders made up 29% of the resident population of the state but were 59% of Maryland’s jail population and 71% of those in Maryland’s prisons. However, since Maryland incarcerates residents at a lower rate, fewer Black residents are incarcerated overall: 594 per 100,000 Black Marylanders compared to 1,014 per 100,000 Black Alabamians are incarcerated in prisons alone. 

Incarceration disproportionately impacts Black men and has ripple effects in the labor market for reentering workers since having a criminal history makes it more difficult to find a job. Ban the box policies seek to reduce the stigma and penalty associated with a criminal record by eliminating disclosure on job applications and delaying background checks until later in the hiring process. Maryland has a statewide ban the box policy for both public and private sector employment, while in Alabama, ban the box has only been adopted for the city of Birmingham.

While these facts do not establish a causal relationship, a striking pattern between rates of incarceration and EPOPs for prime age Black men emerges. Between 2017 and 2021, prime-age (25–54) Black men in Maryland, where incarceration rates are lower, were an average of 14.9 percentage points more likely to be employed than prime-age Black men in Alabama. As shown in Figure D, 83% of prime-age Black men in Maryland were employed compared with just 68.1% in Alabama and 75.4% of Black men nationally. Similarly, Black women were more likely to be employed in Maryland (78.6%) than they were in Alabama (70.6%) or nationally (72.5%). 

Figure D

Large numbers of low-wage jobs do not serve Alabamians and their families

Another factor distinguishing Alabama’s labor market from that of Maryland is the quality of available jobs. The Southern economic development model prescribes that workers are paid low wages and, in keeping with this, Alabama has no state minimum wage; what applies is the federal minimum wage, which has been stuck at $7.25 per hour since 2009. In contrast, as of January 1, 2024, Maryland raised its minimum wage from $13.25 per hour to $15 per hour. 

In December 2023, before Maryland’s $15 per hour minimum wage was in effect, fewer than 10% of Marylanders were paid less than $15 per hour. But in Alabama, the percentage of workers was 22%: More than one in five Alabamians were paid less than $15 per hour. 

Many Alabamians lack access to paid sick leave and paid family and medical leave

In addition to differences in employment-to-population ratios, incarceration rates, and minimum wages, Alabamians are much less likely than Marylanders to have access to paid sick leave and paid family and medical leave—supports which are crucial for balancing work and family. For example, while 90.8% of workers in Maryland have access to paid sick leave, just 68.2% do in Alabama. Again, these dramatically different outcomes reflect different policy approaches in the two states.

Maryland has an earned sick and safe leave law whereby all workers can accrue up to 64 hours of leave time to use for their own or a family member’s illness and in cases of domestic violence, sexual assault, or stalking. The law requires employers with 15 or more employees to provide paid leave, while smaller employers may provide unpaid leave. Additionally, Maryland Family and Medical Leave Insurance goes into effect starting in 2026. This law requires all employers to participate in some form of paid leave insurance offering workers up to 12 weeks of paid leave for the birth of a child, their own or a family member’s serious illness, or to arrange for a family member’s military deployment. In contrast, Alabama does not require employers to provide workers with paid family and medical leave. Rather, employers or individuals may purchase paid family leave benefit policies from private insurance companies. This approach will undoubtably leave many workers, especially low-wage workers, without paid leave. For those who are covered, policies will likely provide fewer weeks of coverage and lower wage replacement rates at higher costs. 

Alabama underinvests in the public sector

The private versus public approach to paid leave is emblematic of broader differences in how the role of government is perceived in Alabama versus Maryland. These disparate views are clearly reflected in each state’s willingness to invest in its public sector, even when the cost is subsidized by the federal government rather than being paid from state and local revenues. Under the American Rescue Plan Act of 2021 (ARPA), federal funds were granted directly to state and local governments. In addition to investments in infrastructure and public health, other approved uses of these funds included offering hiring and retention bonuses to fill public employee vacancies and raising public sector wages. As of September 2023, Maryland has spent 86% of its total state allocation and increased public sector employment by 3.5% between September 2022 and September 2023. Alabama, on the other hand spent just 36% of allocated funds and public sector employment grew just 1.1% over the same period.

These data show that comparing state unemployment rates in isolation paints a misleading picture. At any level of geography, the unemployment rate overlooks workers who want a job but aren’t actively searching due to discouragement, care responsibilities, or other obstacles. But interstate comparisons of unemployment rates also fail to distinguish the quality of jobs available and how policy choices influence these outcomes. Maryland and Alabama provide a striking example of how policies to support working people, ensure adequate pay and access to paid leave, and invest in public goods can help drive higher rates of employment while helping workers to cover basic necessities like food, rent, childcare, and transportation. 

1. The overall incarceration rate includes those in prisons, jails, federal prisons, youth facilities, and involuntary commitments. Prisons and Jails make up the vast majority of these. 

 
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This quote is not from an op-ed written by a political pundit; it’s from a 2016 peer-reviewed article in the American Economic Review. Adding in data since this article was written does not change its conclusion. There is still a pronounced Democratic advantage in nearly every measure of macroeconomic performance. Positive indicators like growth in gross domestic product (GDP), income, and wages are faster, while negative indicators like unemployment, inflation, and interest rates are lower. For those who want to skip right to this bottom line, see Table 1.

Besides the pronounced superiority of macroeconomic performance under Democratic presidents, the fruits of economic growth are also distributed substantially more equally under Democratic presidents. This is true even for data that are dominated by market-based incomes and exclude most of the federal government’s safety net and income support payments. It is, in short, not just driven by Democrats being more supportive of using taxes and spending to reduce inequality.

Given how clear the data are, it is striking that public opinion polling has consistently shown that voters rate Republicans more highly as the party that is better at managing the economy.1

The data presented in Blinder and Watson (2016) and in this report obviously cannot claim to measure the causal effect of partisan White House control on economic performance. The president does not have total control over the economy, and there is a lot of luck and chance that determine economic outcomes. Those who prefer Republican stewardship may consider it just bad luck again and again that keeps their preferred policy ideas from translating into faster growth in real time. And bad luck is a real issue in these examinations. For example, both the Obama administration and the Biden administration inherited a depressed macroeconomy that had been buffeted by severe shocks whose aftereffects had to be managed.

But it is our sense that the simple facts on real-time economic performance during Democratic and Republican administrations—and how starkly better this performance is during Democratic administrations—aren’t particularly well known. And these facts constitute important information people should have during this time of rampant misinformation.

Aggregate results

It is difficult to tell what respondents to opinion polls have in mind when they are asked about “the economy.” For example, respondents often rate the Republican party higher as economic managers yet rate the Democratic party more highly on issues related to health care. But health care is, by far, the single largest sector of the U.S. economy, affecting economic outcomes of households, businesses, and governments in significant ways. It seems hard to imagine that one could manage health care poorly and yet be a decent economic manager overall since health care is nearly a fifth of the U.S. economy.

But it seems fair to guess that what constitutes good management of “the economy” in the minds of polling respondents is fast economic growth, fast income growth, low unemployment, and low inflation. In the jargon of economists, it means successful macroeconomic stabilization.2 Further, these variables can indeed respond relatively quickly (within a year) to decisions of policymakers. Besides these variables, we also include a few others (measures of business investment and market incomes) that more closely measure the performance of the private sector.

Table 1 shows the average performance of a range of key macroeconomic variables under Democratic and Republican administrations since 1949, the beginning of Harry Truman’s first elected term.3 There is a Democratic advantage in every measure.

Table 1

Below we provide a brief description of each variable and why it is included in our analysis.

Real (inflation-adjusted) gross domestic product (annual % growth) is by far the most cited variable for assessing overall macroeconomic health. Gross domestic product (GDP) is the value of all final goods and services produced and sold in the United States—a measure of total economic activity and incomes. The Democratic advantage in this measure (1.2 percentage points) is very large. Given the $27.4 trillion GDP in the United States in 2023, just a single year of growing 1.2% faster would translate into an additional $330 billion in income that could accrue to U.S. families.

Real net domestic product per capita (annual % growth) is a lesser-known measure of economic health, but it measures with even greater precision the potential that economic growth provides for living standards to rise. It provides this greater precision by accounting for population growth and depreciation of the nation’s capital stock. Both are important influences for potential growth in living standards.

For example, real GDP growth has decelerated significantly in recent decades. Some of this reflects genuinely worse economic performance, but part of it simply reflects slower population growth (and hence slower labor force growth) in more recent decades. To account for this, a measure of real domestic product per capita is valuable. Second, recent decades have also seen a large rise in the rate of depreciation in the economy, as more and more of the nation’s capital stock is composed of short-lived computers that need to be replaced regularly. Because depreciation is a drain on gross domestic product, a measure that accounts for this drain—net domestic product—more faithfully tracks the potential of the economy to deliver rising living standards (rather than to simply maintain the nation’s capital stock).

Making these adjustments for population growth and depreciation yields a measure of net domestic product per capita—and here the Democratic advantage is even larger than it is for real GDP growth. At the 2.6% annual growth rate that has characterized Democratic administrations, per capita living standards could double every 28 years—within a single worker’s career. At the 1.3% rate that has characterized Republican administrations, this doubling would take 56 years or twice as long.

Total job growth is the percentage increase in total employment (private-sector plus government employment) over the past year. During Democratic administrations, total job growth has averaged 2.5% annually, while it is barely over 1% annually during Republican administrations. Applied to today’s total workforce, this would imply nearly 2.4 million more jobs created every year under Democratic administrations.  

Private job growth is the percentage increase in private-sector employment over the past year. The Democratic advantage is even larger in private job growth than it is for total job growth. During Democratic administrations, private job growth has averaged 2.6% annually, while it is less than 1% annually during Republican administrations. This also means that private-sector job growth is faster than overall job growth during Democratic administrations but that private-sector job-growth is slower than overall job growth during Republican administrations.  

The unemployment rate is a straightforward measure of how easy it is for jobseekers to find work. Applied to today’s labor force, the Democratic advantage in this measure (0.6 percentage points) would translate into roughly 1 million more people being able to find jobs. Since 1972 the Bureau of Labor Statistics (BLS) has also gathered data on the unemployment rate of Black workers, and there is a consistent Democratic advantage in this measure as well. We show this comparison in Table 2 when we compare performance for the post-1980 periods.

Real (inflation-adjusted) wages for production and nonsupervisory workers measure hourly wages for the roughly 80% of U.S. workers who are not managers. Here again the Democratic advantage is substantial.

Real business investment (annual % growth) is a measure of investment in structures, equipment, and intellectual property made by private-sector businesses (excluding both residential investments and changes to inventories). Some have argued that Republican policy mainstays (lower taxes on corporations and rollbacks of federal regulations) boost economic growth through their alleged effect on business investment. Yet this category shows the largest Democratic advantage in performance by far, with investment growth running at more than double the pace during Democratic administrations than it does during Republican ones.

Real personal income excluding transfers per capita (annual % growth) is a measure of market incomes, excluding the effect on personal incomes of tax changes or public benefits (like Social Security). Again, to the degree that Republican rhetoric reflected actual results, there should be a Republican advantage in generating greater growth in market-driven incomes. Yet again the Democratic advantage is large in this category, with market-driven personal incomes rising at almost double the pace of growth compared with times when Republicans hold the presidency.

Inflation. Average rates of inflation—both overall and “core” measures that exclude volatile food and energy prices—are lower during Democratic administrations. The gap is very small, but it tilts toward Democratic administrations. It’s worth noting that because all of the income and activity measures above are adjusted for inflation already, it should be mostly irrelevant which party generally presides over lower inflation. But recent years have shown that even after accounting for the impact of inflation on wages and incomes, the public does seem to care about inflation in and of itself.

The federal funds rate is a measure of the interest rate set by the Federal Reserve. This rate roughly sets the level of most of the economy’s other interest rates (like mortgage rates, or rates on car loans or credit cards), so it serves as a good barometer for the pressure that interest rates generally might be putting on household budgets. The federal funds rate (only tracked since 1954) is also lower during Democratic administrations than Republican, which means that borrowing money is generally cheaper during Democratic administrations.

Table 2 shows an almost identical set of indicators as Table 1 but measured only since 1981, the first term of the Reagan administration. There are two reasons to look at this set of more recent administrations. First, if the Democratic advantage mostly stems from the performance of very long-past administrations (say that the Kennedy/Johnson administration had superior performance relative to the Eisenhower administration), perhaps many will simply find these comparisons irrelevant.

The second reason has a bit more of a quantitative basis: Some of the variables examined above have possible time trends (both real GDP and inflation, for example), with clear differences between the period before the Reagan administration and the period after the Reagan administration.4 Before 1980, Democratic and Republican control of the White House was split exactly equally, with both parties having 16 years in power between 1948 and 1980. But because Republicans held the White House in 60% of the years after this, perhaps Republican performance is penalized simply by having held power disproportionately in later decades when variables like GDP growth were trending downward, driven by structural forces that neither party had any control over. “Leveling the playing field” by focusing solely on the later period addresses this issue. If slow growth rates after 1980 were driven by structural forces that neither party could affect, then only focusing on this period would penalize both parties equally.

Table 2

Even looking only at the post-1980 period, there is a pronounced (and mostly similar in size) Democratic advantage across all variables, including inflation. Focusing on this more recent period also lets us add a measure—the unemployment rate for Black jobseekers (which the Bureau of Labor Statistics only began collecting in 1972).

Distributional results

Tables 3 and 4 show economic performance by income class under Democratic and Republican administrations. In earlier work looking at trends through the early 2000s, Bartels (2016) documented that household income growth was faster on average and far more equal during Democratic administrations than during Republican ones. Tables 3 and 4, updated with data through 2022, show that this pattern continues.

These two tables show changes in pre-tax money income by income fifth (and the top 5%) using data from the Census Bureau, and the tables also show changes in post-tax, post-transfer income (including in-kind transfers like food stamps or Medicaid) for the bottom half of the income distribution, the 50th through the 90th percentile, the 90th–99th percentile, and the top 1%, using data from the World Inequality Database (WID), which is in turn based on estimations from Piketty, Saez, and Zucman (2018).

Table 3

In Table 3, showing income growth over the full post–1948 period, the Census Bureau data show a Democratic advantage in income growth for every percentile measured, and the advantage uniformly becomes larger the lower one goes down the income distribution.

For example, income growth for families at the 95th percentile of the income distribution (those making more income than 95% of other families) is about 10% faster during Democratic administrations (1.95% average annual growth compared with 1.74% growth in Republican administrations). But families in the middle fifth of the income distribution see growth that is 48% faster during Democratic administrations (1.9% average annual growth compared with 1.3% growth during Republican administrations). And for families in the bottom fifth of the income distribution, income growth is 188% faster during Democratic administrations (2.1% average annual growth compared with 0.7% growth during Republican administrations).

In data from the World Inequality Database, the Democratic advantage also holds for every income grouping, and it is largest for the 50th to 90th percentile and smallest for the top 1%.

Table 4

In Table 4, showing income growth only since 1980, there is again a Democratic“ advantage in pre-tax money income in every income group, and it is by far the largest for the lowest income fifth. In the WID data, there is a Democratic advantage in every income group, and it is by far the smallest for the top 1%.

In short, the clear sweep of income trends is that during Democratic control of the White House, overall income rises faster, income for every measured income class rises faster, and income growth is far more equalizing.

Conclusion

The matching of economic policy decisions and real-time economic performance is far from perfect. Some presidential administrations enact smart policies and run into bad luck, and others enact short-sighted policies and are blessed with good luck. Some might even get the results their policy decisions deserve. One would expect that the large role of chance would (almost by definition) cut uniformly across the partisan composition of presidential administrations. And yet the Democratic advantage in economic performance by partisan control of the presidency is striking.

As Blinder and Watson (2016) note in their abstract, the performance gap between Democratic and Republican administrations is “so large, in fact, that it strains credulity, given how little influence over the economy most economists (or the Constitution, for that matter) assign to the president of the United States.”

All of this seems worth knowing as people make their decisions about which candidates are likely to be better economic managers.

Appendix: Methods and sources

For the measures of aggregate economic performance in Appendix Tables 1 and 2, all data are collected at a quarterly frequency. We date the start of a presidential administration as the third quarter of the year following their election. So, for example, the Biden administration is dated as starting in June 2021. We think this very roughly allows some scope of administration decisions to affect variables, and it lines up relatively closely with the annual data series we use to undertake the analysis of distributional outcomes. Importantly, none of the results or partisan rankings is sensitive at all to reasonable changes in the “window” over which administrations are defined.

For growth measures (including inflation), we average the growth rates measured each quarter relative to the same quarter a year ago. For level variables (like the unemployment and federal funds rate), we use quarterly averages of the unemployment rate. For our comparisons by partisan control of the White House, we simply collapse the averages of all our variables by either Democratic or Republican control of the White House.

For the distributional variables, we measure the start of a presidential administration as the year that they are inaugurated—for example, the Biden administration starts in 2021. So, the first growth rate measured under the Biden administration is average income in 2021 relative to average income in 2020. For making partisan comparisons, we again simply collapse the average growth rate of all variables by either Democratic or Republican control of the White House.

Our variables have the following sources:

Real gross domestic product: The National Income and Products Account (NIPA) Table 1.1.6 compiled by the Bureau of Economic Analysis (BEA).

Net domestic product per capita: NIPA Tables 1.7.6 (net domestic product) and 2.1 (population) compiled by the BEA.

Total job growth: The Current Employment Statistics (CES) online database from the Bureau of Labor Statistics.  

Private job growth: The Current Employment Statistics (CES) online database from the Bureau of Labor Statistics.  

Unemployment rate (including for Black jobseekers): The Current Population Survey (CPS) online database from the Bureau of Labor Statistics (BLS).

Real wages of production and nonsupervisory workers: This is an EPI-derived series using data from the BLS Current Employment Statistics (CES) online database. For 1964 on, we use the overall series for wages for production and nonsupervisory workers for the entire private sector. This series was not available before 1964, so we use the broadest economic sector where wage data is available—goods-producing industries. We use the growth rate for the goods-producing sector and apply it to the overall private-sector levels from 1964 to backcast a consistent series.

Real business investment: NIPA Tables 1.1.6, (Nonresidential fixed investment) from the Bureau of Economic Analysis.

Inflation (including “core” inflation removing food and energy prices): The price deflator for personal consumption expenditures, from BEA NIPA Table 2.3.4. Importantly, the Democratic advantage in inflation performance holds for alternative inflation series as well, like the CPI-U (overall and core) or the CPI-U-RS (overall and core).

Federal funds rate: These data are obtained from the Federal Reserve Economic Database (FRED) of the Federal Reserve Bank of St. Louis.

Money income by income fifth and top 5%: These data are obtained from the Historical Income Statistics: Family Program of the Census Bureau. To measure incomes consistently over time, we have to account for two breaks in the series that represent methodological changes made by the Census Bureau in 2013 and 2017. In both cases, the Census Bureau has provided an income measure using both the old and the new method of calculating incomes. This lets us use the growth rate between the “break year” estimate using the new method and the subsequent year (which also is calculated with the new methodology). Because we are only interested in growth rates and not income levels, this lets us use a growth rate each year that is not infected by methodological changes.

Post-tax, post-transfer incomes of the bottom 50%, the 50th to 90th percentiles, the 90th to 99th percentiles, and the top 1%: These data are obtained from the World Inequality Database (WID) using methods first laid out by Piketty, Saez, and Zucman (2018). We use post-tax, post-transfer income of all adults, assuming an equal split of household income between married adults.

Notes

1. See Newall and Feldman (2023) for one example of this polling advantage. Over the longer run (since the 1950s, when Gallup first began asking a regular question) neither party has held a public opinion monopoly on being more trusted to “keep the country prosperous,” but since 2000, Republicans have been slightly more likely to have an advantage. See Saad (2023) and the linked data in that report for an examination of longer-run trends on this issue.

2. Macroeconomic stabilization is, of course, only one target of policymakers (though a very important one). There are also policies potentially meant to influence the rate of long-run growth. By definition, the effect of such policies will be far less related to contemporaneous control of the White House, so we do not look at these in the present study. It is worth noting, however, that there are few instances where policies that spur successful macroeconomic stabilization would be somehow bad for long-run growth. Further, political realism argues that presidents would generally not choose to sacrifice successful near-term macroeconomic stabilization (tolerating high unemployment or high inflation) to bequeath higher long-run growth (even if that were a viable trade-off). Given all of this, it would be hard to credit arguments that Republicans care so much about long-run growth that they are willing to sacrifice near-term performance.

3. For details on each variable, including its construction, see the Appendix.

4. See McConnell and Quiros (1997) for some of this evidence.

References

Bartels, Lawrence M. 2016. Unequal Democracy: The Political Economy of the New Gilded Age. Princeton, N.J.: Princeton Univ. Press.

Blinder, Alan S., and Mark W. Watson. 2016. “Presidents and the US Economy: An Econometric Exploration.” American Economic Review 106, no. 4: 1015–1045.

McConnell, Margaret M., and Gabriel Perez Quiros. 1997. “Out Put Fluctuations in the United States : What Has Changed Since the Early 1980s?” Federal Reserve Bank of New York Research Paper No. 9735, November 1997.

Newall, Mallory, and Sarah Feldman. 2023. “One Year from Election Day, Republicans Perceived as Better at Handling the Economy.” Ipsos website, November 5, 2023.

Piketty, Thomas, Emmanuel Saez, and Gabriel Zucman. 2018. “Distributional National Accounts: Methods and Estimates for the United States.” Quarterly Journal of Economics 133, no. 2: 553–609.

Saad, Lydia. 2023. “Neither Party Well-Liked, but GOP Holds Advantage on Issues.” Gallup. October 3, 2023.

The Civil Rights Movement ushered in a new chapter in American history. The combined efforts of many moved the U.S. Congress to pass sweeping civil rights legislation to reverse oppressive Jim Crow laws and broadly combat discrimination against people of color.

While this movement succeeded in removing key barriers to equal rights under the law, many economic demands were left unmet. Failure to address these has adversely impacted the economic security of people of color and exacerbated many of the long-standing racial disparities in economic outcomes present today.

This report examines the difficult relationship between public policy and racial inequality in the United States. First, the report briefly outlines the history and evolution of structural racism from Reconstruction to the beginning of the Civil Rights Movement. Next, the report explores the policy demands the Civil Rights Movement championed through the March on Washington and the Kerner Commission. Then, the report examines whether federal policies implemented since the civil rights era have supported or undermined the demands from that period and the effects that those policies have had on the economic status of Black Americans. Finally, the report outlines ways in which policymakers can improve the lives of Black Americans and fulfill the civil rights era promise of racial equity.

This examination focuses mostly on Black Americans’ outcomes, given their central role in motivating the civil rights legislation designed to reverse the harm that Jim Crow legislation inflicted on the Black community. To assess Black Americans’ economic standing over the decades, the report analyzes changes in their unemployment rate, median hourly wages, union coverage, wealth, and homeownership rate. The report also examines access to basic rights and freedoms, measured by changes in voter registration, voter participation, and incarceration rates.

Past public policy laid the groundwork for the pervasive economic inequality that many people of color face today. Race-neutral legislation intended to help families earning low incomes and alleviate economic strain among middle-class households has only mitigated racial economic disparities slightly. That’s because these disparities are the result of policies that denied Black families the opportunity to build wealth and economic stability and fully participate in American society. Racial economic inequalities will persist without legislation explicitly targeting and remedying the injustices left unresolved by race-neutral policies, which disregard the challenges that specific racial or ethnic groups face.

In contrast, race-conscious policies acknowledge the historical and systemic disadvantages these groups endure and strive to address those disparities. These policies offer support to communities that have historically faced marginalization. The U.S. can achieve the dream of racial equity and justice through the implementation of race-conscious policies.

The history and evolution of structural racism in the U.S.

The United States was founded on the pillars of equality, opportunity, and prosperity for all. Yet throughout its history, the nation has struggled to live up to these ideals.

From slavery to Jim Crow segregation, systemic racism has been at the heart of policy decisions that deprived Black Americans and other people of color of economic opportunity, security, and freedom. This history of racial injustice and economic inequality is embedded within American attitudes, ideas, institutions, and policies that together preserve a racial hierarchy established during this nation’s early years.

Key moments in American history laid the foundation for structural racism, enabling and perpetuating racist policies that hinder the progress of Black Americans today. This section provides a historical overview from the end of the Civil War through the civil rights era.

Reconstruction (1865–1877)

Immediately following the Emancipation Proclamation and the end of the Civil War, Congress was seeking to rebuild a divided nation and integrate formerly enslaved people and white Southerners into a post-slavery society. During this period, Congress created the Freedman’s Bureau, which provided food, housing, medical aid, and land settlements to formerly enslaved people. Congress also passed the 14th Amendment, which gave formerly enslaved people citizenship, and the 15th Amendment, which granted formerly enslaved men the right to vote.

The period from 1867 to 1877 was known as the Radical Reconstruction. During this time, Black men were allowed to vote, actively participate in the political process, acquire the land of former slaveowners, seek their own employment, and use public accommodations (LOC 2023).

The rise and persistence of Jim Crow laws (1877–1960s)

Many Southern whites opposed the progress being made by Black Americans and reacted with both political and physical violence toward Black Americans. This backlash culminated in the passage of Jim Crow laws that were upheld by the 1895 U.S. Supreme Court case Plessy vs. Ferguson (National Constitution Center 2023). This ruling allowed states and localities to continue implementing and enforcing racial segregation if institutions supplied separate, but equal, services for each race.

These laws were later echoed in exclusions strategically denying many Black Americans the economic benefits provided by bills such as the Fair Labor Standards Act of 1938, the G.I. Bill, and the New Deal. These policies maintained economic and political disenfranchisement for Black Americans, thus limiting their rights and freedoms and enabling decades of racial segregation and economic oppression.

Civil rights era (1950s and 1960s)

The movement for desegregation and legal protections against discrimination affected a critical shift politically in the U.S. during the civil rights era (early 1950s to late 1960s). During this time, grassroots community organizing and protests for equal rights under the law fueled the public pressure that finally brought legislative change.

View of the crowd from the Lincoln Memorial to the Washington Monument, during the August 28th, 1963 March on Washington. Photo by Warren K. Leffler.

The civil rights era led to the enactment of inclusive legislation that outlawed segregation and employment discrimination, dismantled legal barriers to voter registration, and challenged the denial of basic human rights. The 1960s were noteworthy for the passage of the Civil Rights Act of 1964, the Voting Rights Act of 1965, and the Fair Housing Act of 1968. Additionally, Executive Order 12246 instituted affirmative action as a federal policy in 1965. This policy mandated that employers take proactive steps to ensure the fair treatment and employment of job seekers and employees, regardless of their race, color, religion, sex, or national origin.

This period marked a time in which the Black community publicly asserted their right to be treated as equal citizens in the United States. The 1963 March on Washington for Jobs and Freedom embodied these demands, which included fair access to housing, a sufficient minimum wage, equal employment, voting rights, and expansion of the Fair Labor Standards Act (Robinson and Rustin 1963). Toward the end of the 1960s, these demands were reiterated in recommendations from the 1968 Report of the National Advisory Commission on Civil Disorders—also known as the Kerner Commission—which was established to assess the key issues facing Black Americans and the causes of “race riots” in cities across the country.

Despite a brief period of progress for Black Americans immediately following the ratification of civil rights legislation, ongoing improvements were not sustained in the following decades, and many of the key demands of the movement were left unaddressed (Austin et al. 2013). This report examines some of the remaining demands and the crucial role that policy has played in shaping the deeply entrenched inequities experienced by Black Americans and in exacerbating structural barriers to prosperity for all people of color. The absence of targeted, race-conscious policy solutions to these barriers has created even more distance between communities of color and equal opportunity within the labor market and the overall economy.

The March on Washington

Dr. Martin Luther King, Jr. at the Civil Rights March on Washington. Photo taken by Rowland Scherman on August 28th, 1963, in Washington D.C.

On August 28, 1963, over 200,000 demonstrators participated in the March on Washington for Jobs and Freedom in Washington, D.C. Though the event is remembered for Dr. Martin Luther King Jr.’s “I Have a Dream” speech, the goals of the protest were largely economic. Leading up to the event, Black Americans faced dismal conditions: The Black unemployment rate was consistently high, and the community suffered from low wages and poor job mobility, systematic disenfranchisement through rampant voter suppression, and persistent racial segregation in the South (King Institute 2023). Discussions of these barriers crystallized around a large-scale march to call for both racial and economic justice. The goals of the protest included:

• A national minimum wage act that would “give all Americans a decent standard of living”
• “Comprehensive and effective” civil rights legislation to guarantee the right to vote, decent housing, adequate and integrated education, and equal access to all public accommodations
• A broadened, more inclusive Fair Labor Standards Act that would include all areas of employment that were presently excluded
• A massive federal program to train and place unemployed workers

Following the historic march, civil rights leaders met with President Kennedy to advocate for legislation that addressed these demands. Within a few years, the Civil Rights Act of 1964, the Voting Rights Act of 1965 and the Fair Housing Act of 1968 were passed, reflecting many of the demands outlined during the March on Washington.

The unanswered call of the Kerner Commission

Shortly after the monumental civil rights bills passed, civil and racial tensions reached an all-time high. In the summer of 1967, there were close to 160 race riots in cities across the nation (Britannica 2023). These riots surged the following year after the assassination of Dr. Martin Luther King Jr.

To better assess the root causes of the civil and racial unrest, President Lyndon Johnson established the National Advisory Commission on Civil Disorders, popularly known as the Kerner Commission, to investigate the riots and the core issues facing Black Americans (Haberman 2020). Their report named “white racism” as the primary culprit for the Black community’s frustration, which corresponded with systemic discrimination in employment, education, and housing. The report offered many recommendations to mitigate these issues, including calling for the creation of new jobs and the construction of new housing to disrupt residential segregation. Some of the recommendations specific to economic empowerment included (Haas 2018):

• Increasing the minimum wage and widening its coverage
• Strengthening federal, state, and local efforts to ensure equal opportunity
• Intensifying efforts on behalf of the Department of Labor to secure commitments from unions to encourage [Black] membership
• Creating 1 million jobs in both the public and private sectors within three years
• Enacting a national, comprehensive, and enforceable open occupancy [Fair Housing] law and expanding the supply of low-income housing
• Increasing work incentives and training, which included offering job training, providing day care centers for children, and allowing recipients to retain a greater part of their earnings

Unfortunately, President Johnson rejected and largely ignored the Kerner Commission’s recommendations, thus failing to address the social and economic needs of Black families in 1968 and beyond.

Many of the concerns and recommendations the Kerner Commission outlined in their report echoed the demands of the 1963 March on Washington for Jobs and Freedom. These issues continue to plague Black Americans and other marginalized people today. Lack of access to good jobs, fair wages, homeownership, and affordable housing contributes to worsening racial disparities.

Structural racism has worsened disparities

The Civil Rights Movement brought forth pivotal policies aimed at creating opportunities for Black workers and their families. Shortly after the passage of these bills, Black workers saw notable gains in earnings as previously denied employment and educational opportunities were made available. But the roots of structural racism run deep. Without addressing most of the core demands of the March on Washington or the suggestions from the Kerner Commission Report, many well-intended policies have done little to break down the stubborn barriers to economic prosperity for Black workers.

This section examines federal policies enacted in the aftermath of the civil rights era to boost equal employment opportunities and fair compensation, fair access to housing and wealth distribution, and fundamental rights and freedoms. Additionally, this section analyzes the data within these core categories to highlight the enduring presence of racial disparities over time.

Equal employment and fair pay

In the late 1960s and early 1970s, Black workers began to experience some measurable gains in the economy and labor market following civil rights era shifts in policy. From 1972 to 1980, the number of employed Black workers increased by 1.3 million, or 17% (Westcott 1982). These gains were particularly found in occupations from which Black workers had been excluded in the past, including professional and technical, managerial and administrative, sales, and clerical jobs.

Despite these gains and shifts in the types of jobs they held, Black workers continued to face large disparities in employment and earnings.

Persistently high unemployment rates for Black workers

Black workers have consistently experienced unemployment rates that are roughly twice as high as those faced by white workers (Gould and Wilson, 2020). This unfortunate yet defining feature of the U.S. labor market is documented in federal statistics dating back to 1954 when the Bureau of Labor Statistics first published “white and nonwhite” unemployment rates (Wilson and Darity 2022). In 1963, the year of the March on Washington, the unemployment rate was 5.0% for whites, but 10.9% for Blacks—or more than two times as high as the white rate. Following the passage of civil rights legislation and aided by a strong economic expansion, Black communities saw a decline in unemployment and an expansion of labor market participation. However, Black communities continued to bear more of the burden of unemployment.

Limited access to higher education among Black Americans and the resulting racial education or skills gaps are often cited as a major factor behind racial disparities in unemployment (Wilson and Darity 2022). However, major strides in high school and college completion since the 1960s have done little to equalize average Black and white unemployment rates. Black-white gaps in unemployment also exist at every level of education. These patterns, along with field experiments that reveal evidence of racial biases in hiring, point to the enduring effect of racial discrimination on persistently high levels of Black unemployment.

Even during some of the worst economic downturns of the last 50 years, the annual white unemployment rate has never been higher than 10%. The annual Black unemployment rate, however, reached 19.5% at its peak in 1983, compared with the record-high 8.7% annual unemployment rate for white workers in 2010 (BLS 2022a, 2022b). Figure A illustrates the disparate rates of unemployment (on an annual basis) for Black and white workers from the late 1970s to 2021.

Figure A

Although economic expansion—before and after the pandemic-triggered recession—resulted in historically low Black unemployment rates and narrowed the gap between Black and white workers to within 3 percentage points, rates for the two groups have never completely converged.

Racial wage gaps

Racial wage gaps have persisted from the 1960s to the present, highlighting enduring inequalities in the labor market. During the 1960s, earnings inequality narrowed rapidly, followed by an expansion starting in the mid- to late-1970s (Rodgers 2019). Despite reaching a record low in 1979, the Black-white wage gap has incrementally increased since then, as seen in Figure B. Today, the median Black-white wage gap is 23.4%—meaning a typical Black worker is paid 23.4% less per hour than a typical white worker.

Figure B

Moreover, workers’ wages have failed to rise with their growth in productivity over the last 40 years, as shown in Figure C. The typical worker’s wages rose only 23.1% from 1979 to 2020—while productivity broadly increased 61.7%. The large discrepancy reflects growing wage inequality over that period, as the highest-wage workers reaped a disproportionate share of the productivity gains. For Black workers, wage gains were further limited by racial discrimination in the labor market (Moore and Banerjee 2021), leaving them further economically disadvantaged: The typical Black worker’s wage growth was only 18.9% over that period.

Figure C

Factors influencing racial wage gaps

Racial wage gaps persist due to a combination of factors, including stagnant minimum wage, falling union coverage, and systemic factors such as occupational segregation, discrimination in hiring and pay, and inequitable pathways to promotion. This section will focus primarily on how minimum wage policies and declining rates of union coverage—two issues referenced in demands from the March on Washington and Kerner Commission recommendations—have affected the Black-white wage gap.

Minimum wage policy has impacted the Black-white wage gap in at least two distinct ways—lack of coverage for occupations disproportionately held by Black workers and failure to increase the minimum wage over time.

Under the 1966 and 1974 expansions of the Fair Labor Standards Act (FLSA), previously excluded workers in sectors such as agriculture, education, nursing homes, and restaurants saw a $1 wage floor that boosted earnings. Before this expansion, many of the workers in these sectors did not have a minimum wage. This boost particularly benefited Black workers.

The impact of these changes was significant because the newly covered sectors employed approximately one-fifth of the U.S. labor force—or nearly one-third of all Black workers. (Derenoncourt, Montialoux, and Bahn 2020). Though the 1966 amendment to the FLSA expanded the share of workers receiving the minimum wage, many Black workers were still underrepresented regarding coverage until 1974. While the FLSA expansions may have played a role in narrowing the Black-white wage gap, the economic conditions of Black workers remained less favorable than those of white workers. Particularly, stagnant federal minimum wage policies have failed to keep pace with the rising cost of living, disproportionately impacting lower-wage workers, many of whom are people of color.

Unions are critical to raising wages, combating income inequality, and reducing racial economic disparities (EPI 2021b). Concerted efforts by wealthy corporations and their allies to weaken unions have resulted in declining union membership and coverage since the late 1970s. This decline has eroded workers’ collective bargaining power and suppressed wages (Mishel and Bivens 2021). During the 1980s—the decade in which the sharpest decline in union membership occurred—anti-union sentiments were expressed at the highest level of government as the Reagan administration was known for its union-busting actions. In perhaps the most glaring example, on August 5, 1981, President Ronald Reagan fired 11,345 striking air traffic controllers, barred them from ever working for the federal government again, and decertified the Professional Air Traffic Controllers Organization union that called the strike (Schwarz 2021).

Beginning in the 1940s, Black workers have historically led white workers in union coverage—the percentage of the workforce that has joined a union or is covered by a collective bargaining unit—and received a larger than average wage boost from being covered by collective bargaining (Farber et. al. 2021). These factors helped to raise the wages of Black workers closer to those of their white counterparts. However, the sharp decline in union coverage over the last several decades has greatly narrowed the difference between Black and white workers, as shown in Figure D. This decline in union coverage has had an adverse effect on the Black-white wage gap.

Figure D

Attempts to build greater equity in employment

Consistently substandard labor market outcomes among Black workers demonstrate the need for federal policies that establish strong and inclusive labor standards, protect the right to a union and collective bargaining, and enforce equal employment opportunities and fair and equal pay to achieve equity and economic security. To address the civil rights era demand for “a massive federal program to train and place unemployed workers” and stronger government efforts to “ensure equal opportunity,” Congress introduced three key bills spanning several decades: the Equal Opportunity Act of 1972, the Job Training Partnership Act of 1982, and the 2014 Workforce Innovation and Opportunity Act. With the exception of the Equal Opportunity Act of 1972, these bills were largely focused on helping workers to overcome individual deficits in skills and training but failed to rectify structural and systemic inequalities that created disparate outcomes, including unequal implementation of workforce programs.

The first bill, the Equal Opportunity Act of 1972, amended Title VII of the Civil Rights Act of 1964 to address employment discrimination against Black Americans and other racial minorities. Under Title VII, the Equal Employment Opportunity Commission (EEOC) was authorized to take enforcement action against individuals, employers, and labor unions that violated the employment provisions in law. The 1972 bill expanded the authority of the EEOC to include employers with at least 15 employees instead of the previous minimum of 25 employees. While this extended civil rights protections to more workers, the EEOC has been vastly under-resourced over time, limiting the agency’s capacity to pursue valid charges or proactively challenge discriminatory practices (Yang and Liu 2021).

Subsequently, Congress passed the Job Training Partnership Act of 1982, which repealed the Comprehensive Employment and Training Act of 1973 (CETA). This bill established federal assistance programs to train youth and adults for entry into the labor force and provided job training to economically disadvantaged people and other individuals facing barriers to employment. The intention was to provide job training and other services to these groups to improve employment and earnings, increase educational and occupational skills, and decrease welfare dependency (Kirby 2004). However, unlike CETA, the Job Training Partnership Act did not include a public jobs component.

The Job Training Partnership Act authorized appropriations for fiscal year 1983 and for each succeeding fiscal year to implement adult and youth programs, federally administered programs, summer youth employment and training programs, and employment and training assistance for dislocated workers. Specifically, the $618 million bill included appropriations for any fiscal year of no more than 7% of the total amount appropriated by the bill for employment and training programs for Native Americans and migrant and seasonal farmworkers; veterans’ employment programs; the national employment and training program; a comprehensive labor market information system; the National Commission for Employment Policy; and training programs to fulfill affirmative action obligations.1 Five percent of the appropriations was designated for veterans’ employment programs, and $2 million was designated for the National Commission for Employment Policy—leaving about 2%, or about $10 million, of the appropriations to fund the rest of the measures outlined in the bill.

Unfortunately, the implementation of this bill was inefficient and discriminatory. Preliminary research by the U.S. Government Accountability Office found that (Thompson 1991):

• Racial disparities existed in training provided to Black recipients in 11–20% of the service delivery areas.
• White participants were more likely to receive classroom training and on-the-job training, while Black participants were more likely to receive only job search assistance.
• Black participants that did receive classroom training were more likely to be trained for lower-wage jobs.

Unequal program implementation renders even the most well-intentioned bill ineffective. Without proper implementation and enforcement, policies can cause further harm to communities that desperately need support.

The 2014 Workforce Innovation and Opportunity Act (WIOA) was another pivotal bill intended to strengthen federal workforce training programs. The bill replaced the Workforce Investment Act of 1998 (successor to the Job Training Partnership Act of 1982) and authorized job training and related services for unemployed or underemployed workers and established the governance and performance accountability system for the WIOA program. The bill also authorized education services to assist adults in improving their basic skills, completing secondary education, and transitioning to postsecondary education.

While the WIOA program has the potential to address crucial disadvantages for Black workers, the federal workforce system does not evenly distribute economic opportunity and exacerbates existing patterns of occupational segregation, providing only limited relief and upward mobility for Black workers during an economic downturn (Camardelle 2021). For example, data indicate that under the WIOA system, Black workers had the lowest earnings among all groups after completing federal workforce training, despite having the highest employment rate of all groups (DOL 2020).2 This is striking because Black workers use WIOA services more than most other racial groups with the exception of white workers (DOL 2021).

While post–civil rights era laws addressed some of the concerns that Black workers faced, Black Americans struggled to participate fully and equally in American society and the labor market, which is reflected in ongoing employment and wage disparities. The following sections discuss two more important themes from the March on Washington and recommendations of the Kerner Commission—access to affordable housing, and access to basic rights and freedoms.

Fair access to affordable housing

Homeownership and affordable housing have been out of reach for many Black families compared with white families due to discriminatory and racist policy (Rothstein 2017). Between 1934 and 1962, the Federal Housing Authority financed mortgages and built affordable, good quality public housing almost exclusively for white families (Schweitzer 2020). Additionally, the Servicemen’s Readjustment Act of 1944—also known as the G.I. bill—guaranteed numerous benefits for World War II veterans, including loans for veterans who borrowed money to purchase a home, business, or farm. However, most of the approximately 1.2 million Black war veterans were denied the same benefits that white veterans received (Brown 2021).

Today, the legacy of these policies and discriminatory practices like exclusionary zoning have kept Black families from achieving broad homeownership, building wealth, and accessing affordable housing (Rigsby 2016). Some of these political and economic decisions have not only affected the Black community but have also had widespread implications for overall housing costs.

One illustration of this is the implementation of exclusionary zoning, which has resulted in a shortage of housing and contributed to increased housing costs (Maye and Moore 2022). Consequently, affordable housing options have become more inaccessible for many individuals and families. This not only affects marginalized communities but also has broader implications for housing affordability and the overall housing market. As of 2019, over a quarter of homeowners with a mortgage were burdened with housing costs of more than 30% of their household income, which exceeds the affordability threshold that has become the standard for owner-occupied housing in the United States (U.S. Census Bureau ACS 2023). Without targeted, race-conscious polices to combat decades of exclusionary and discriminatory housing policies, homeownership and affordable housing will remain largely inaccessible to many Black families and others with limited income and wealth (Maye and Moore 2022).

To supplement the Fair Housing Act of 1968, Congress passed the Housing and Community Development Act of 1974 (HCDA). The HCDA amended the Housing Act of 1937 to create Section 8 housing, authorize “Entitlement Communities Grants” to be awarded by the United States Department of Housing and Urban Development, and create the National Institute of Building Sciences.

The Housing and Community Development Act was created to make grants to state and local governments to address urgent community development needs related to housing for low- and middle-income families and to prohibit discrimination based on race, color, national origin, disability, age, religion, and sex within Community Development Block Grant programs or activities.3 However, discrimination within low-income housing created from the HCDA persists, as does the broader inaccessibility of affordable housing (Demsas 2021).

Similarly, the Equal Credit Act, passed in 1974, made it unlawful for creditors to discriminate against applicants with respect to any aspect of a credit transaction on the basis of:

• race, color, religion, national origin, sex, marital status, or age (provided the applicant has the capacity to contract)
• the applicant’s use of a public assistance program to receive all or part of their income or
• the applicant’s previous good-faith exercise of any right under the Consumer Credit Protection Act

Despite the bill’s intention to expand credit access, Black applicants are consistently more likely to be denied loans than applicants from other racial groups (Passy 2022). According to the most recent Home Mortgage Disclosure Act (HMDA) data, 16.1% of all mortgage applications were denied in 2020. Black borrowers had the highest denial rate at 27.1%, while white borrowers had the lowest at 13.6% (Choi and Mattingly 2022). Other research similarly found that Black applicants are denied mortgages at a rate 84% higher than that of white applicants (Bachaud 2022).

Because of high denial rates for mortgage loans, Black families are often targeted for subprime loans and other forms of predatory lending (Badger 2013). These practices create greater barriers to Black homeownership and restrict Black families’ ability to build wealth through accumulated home equity, as seen in the low rates of homeownership for Black households relative to white households in Figure E.

Figure E

In addition to restricting Black homeownership, the legacy of exclusionary zoning and other forms of explicit housing discrimination has also curtailed the accumulation of wealth among Black families. Figure F shows the low rates of wealth for Black families compared with white families over the past three decades. While most American families’ wealth is closely tied to the value of their home, this tie is even stronger for Black and brown families. Homeownership wealth makes up a larger portion of their comparatively smaller net worth than for white families, as shown in Figure G.

Figure F

Figure G

Basic rights and freedoms

After the civil rights era, basic rights such as the right to vote were still actively being undermined in many states. In response, communities of color looked to the federal government to strengthen and support their voting rights and protections.

The federal government’s protection of voting rights for Black Americans was initially challenged by President Reagan and then ultimately struck down by the Supreme Court. In 1982, President Reagan signed a bill to extend the Voting Rights Act of 1965 for 25 years, after a grassroots lobbying and legislative campaign forced him to abandon his plan to ease that law’s restrictions. The Voting Rights Act was amended five times after its implementation in 1970, 1975, 1982, 1992, and 2006. The extension was necessary because coverage provisions, such as the preclearance requirement of the bill in the original Voting Rights Act, were set to expire in 1970. The preclearance requirement included constraints placed on certain states and federal review of states’ voting procedures. However, by the time the extension was due, there were concerns about the continued presence of voting rights violations and discrimination. Consequently, Congress continued to amend the Act to extend the original provisions of coverage. From 2006, the protections within the Voting Rights Act remained untouched until 2013.

In 2013, the U.S. Supreme Court ruled Section 4(b) of the Voting Rights Act unconstitutional, stating that the preclearance requirement was outdated. This ruling enabled 29 states to enact restrictive voting laws, which included the closure of voting sites, the enactment of voter ID laws, and limits on early voting (Singh and Carter 2023).

Figure H shows voter registration rates for voting-age Black and white citizens in presidential election years from 1980 to 2020. Despite an increase in Black voter registration between 1980 and 1984, which surpassed 70%, it took until the 2012 election—almost 30 years—for Black voter registration to exceed its 1984 peak. These peak years in Black voter registration are also significant because they involved nationwide campaigns by Black presidential candidates—Jesse Jackson in 1984 and Barack Obama in 2012.

Figure H

Black voters have historically had lower voter turnout than white voters. Little progress has been made in mitigating the volatility and persistence of these disparities as state efforts to suppress voter turnout and gerrymander districts have only increased (Timm 2021). But, as seen in Figure I, the white-Black voter turnout gap—the percentage of registered white voters who voted minus the percentage of registered Black voters who voted—hit historic lows during the 2008 and 2012 presidential elections. Similar to the peak years for Black voter registration, 2008 and 2012 involved the historic election and reelection of the nation’s first Black president, Barack Obama. Black voter turnout exceeded white voter turnout in 2012. However, following those two election cycles, the gap widened again—rising to 8.3 percentage points in 2020.

Figure I

These findings suggest that in addition to protecting the basic right to vote, the political engagement of Black voters is also motivated by a sense that there are candidates who represent them and their issues. Thus, reducing systemic barriers people of color face in running for office is also key for a strong and equitable democracy.

Although voting rights protections were extended under the Reagan administration, President Reagan’s fervent campaign to maintain “law and order” and triumph in his so-called war on drugs threatened the lives and well-being of Black families. Under this premise, the Reagan administration directly targeted Black families with new policies criminalizing the socioeconomic challenges experienced by Black Americans and increasing enforcement actions in communities of color.

In addition to criminalizing drug users in a “war on drugs,” the Reagan administration campaigned against families who received welfare and government support and made significant cuts to federal safety net programs like Medicaid, food stamps, and federal education programs—all of which greatly impacted economically vulnerable communities of color (Potter 2021). Many of Reagan’s policies have been linked to the exacerbation of social and economic inequities, including wealth and income inequality and the rising trend in mass incarceration (Srikanth 2020).

In 1984, the Reagan administration passed the Comprehensive Crime Control Act. This bill increased federal penalties for the cultivation, possession, and transfer of marijuana and abolished parole for federal prisoners convicted after November 1, 1987. Shortly after, the Reagan administration enacted the Anti-Drug Abuse Acts of 1986 and 1988. These laws transformed the system of federal supervised release from a rehabilitative system to a punitive one. The 1986 Act legalized new mandatory minimum sentences for drugs, including marijuana, while the 1988 Act created the policy goal of a drug-free America, established the Office of National Drug Control Policy, and restored the federal government’s use of the death penalty. The 1988 Act also included amendments to make crack cocaine the only drug with a mandatory minimum penalty for a first offense of simple possession—a drug that, at the time, had largely affected communities of color.

Ultimately, the Reagan administration’s criminalization of drug use and addiction resulted in the incarceration of a substantial number of Black Americans. Between 1980 and 1993, the percentage of sentenced inmates who were Black grew from 46.5% to 50.8% (Stanglin 2020). Increased criminalization of Black Americans limited the social and economic outcomes of Black families, often with disastrous consequences for entire communities and across multiple generations.

This trend toward increasingly punitive policies continued into the Clinton administration. In 1994, President Clinton signed the Violent Crime Control and Law Enforcement Act. This law—commonly referred to as the 1994 Crime Bill—is the largest crime bill in U.S. legislative history. The act expanded federal crime law in several ways: It implemented a federal death penalty, eliminated higher education for inmates, invested $9.7 billion in funding for prisons, and authorized the Community Oriented Policing Services to hire 100,000 police officers. The bill aligns with the theme of many post–civil rights era policies by criminalizing the symptoms of poverty without alleviating the associated levels of inequality and hardship.

The investment in law-and-order policies in the 1980s and 1990s is directly linked to the rise in incarceration rates in those decades. As shown in Figure J, incarceration rates began to rise significantly in state prisons starting in the mid-1970s. Local jail incarceration rates also began to rise in the early 1980s. Federal incarceration rates gradually began to increase from the mid-1980s to about 2012. With the cumulative effects of the 1994 Crime Bill and the Reagan administration’s Comprehensive Crime Control Act and Anti-Drug Abuse Acts of 1988 and 1989, incarceration rates for federal, state, and local prisons more than tripled between the mid-1970s and early 2000s.

Figure J

Beginning in 2009, federal, state, and local incarceration rates began to decline steadily. While the racial disparity in incarceration rates also declined over that time, a significant gap still persists. As seen in Figure K, the Black incarceration rate was approximately 6.3 times as high as the white incarceration rate in 2009. By 2019, the Black incarceration rate had dropped by nearly 30% (from 1,544 to 1,096 per 100,000 residents) but was still 5.1 times as high as the white incarceration rate. The crime reform bills of the 1980s and 1990s continue to play a significant role in weaponizing the justice system against marginalized communities and reinforcing patterns of economic vulnerability.

Figure K

Going forward: Policy recommendations

Although six decades have passed, the demands presented during the March on Washington still serve as the bedrock for addressing structural racism and improving social and economic outcomes for Black Americans. Many of the pressing issues that motivated the March on Washington have yet to be resolved. Most policies enacted since then have offered race-neutral solutions that cannot tackle the enormity of structural racism. Policymakers need both targeted and race-conscious policies to address the root issue of racism within U.S. institutions, make scalable investments in eliminating racial inequality, and achieve genuine racial equity.

Lessons from the Great Recession and the pandemic recession

Over the past 15 years—from the Great Recession to the ongoing COVID-19 pandemic—most workers have faced great economic instability from the shockwaves created by global financial and public health crises. In both instances, legislators were galvanized into acting fast to save the economy. Policymakers tried to keep the U.S. economy afloat through a broad infusion of federal spending, including a combination of direct stimulative investments, fiscal support for states and localities, tax expenditures, and enhancements to federal programs that provide critical support to families. However, the scale of federal interventions relative to the scope of the problem during the Great Recession and COVID-19 recession were dramatically different. Consequently, the measurable economic impact of those interventions also differed.

The American Recovery and Reinvestment Act of 2009 (ARRA), passed in response to the Great Recession, had a total cost of approximately $831 billion between 2009 and 2019, making it one of the largest stimulus packages in U.S. history at the time (CBO 2012). During the worst years of the COVID-19 pandemic, two key bills, totaling about $4 trillion, were passed: the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020 and the American Rescue Plan Act of 2021.

The more recent bills directed much-needed investment in health care, education, infrastructure, and financial support to workers. The CARES Act was the largest economic stimulus package in U.S. history. Along with the American Rescue Plan Act, the CARES Act provided critical relief to workers and their families in the form of economic impact (stimulus) payments, an expanded Child Tax Credit, expanded eligibility and enhancements for unemployment insurance, and food and housing assistance. By providing critical support to those who were struggling to get by in the wake of the pandemic recession, these programs kept millions of people out of poverty, with a particularly large impact on Black and Hispanic households (Banerjee and Zipperer 2021, 2022; Wilson and Maye 2022).

These measures also fueled a rapid jobs recovery. Private sector employment recovered in 27 months, compared with 76 months following the Great Recession. The recent jobs recovery reduced the Black unemployment rate to historic lows (EPI 2023a). Further, the tightening labor market helped to support stronger wage growth among low-wage workers who are disproportionately Black and Hispanic (Gould and deCourcy 2023).

These policies were passed out of necessity to address the state of the economy and combat a global crisis. Their success highlights that, if motivated to do so, federal policymakers could authorize an appropriate level of investment to oppose the lingering economic effects of what is America’s oldest crisis—structural racism.

Policy proposals to advance racial equity

To achieve racial equity and justice, policymakers must fix the policy failures that have perpetuated systemic disparities and identify policy measures that meet the size and specificity of these problems. Using the demands from the March on Washington as a framework, this report will outline policy recommendations in three key areas: fair pay and equal employment, fair access to housing and wealth, and other essential rights and freedoms. By addressing these fundamental pillars, policymakers can tackle the main barriers preventing Black Americans from fully participating in the economy and society.

Fair pay and equal employment

The demands issued during the March on Washington show the interconnectedness of labor and civil rights: Policies to advance racial equity must address fair and adequate pay and equal opportunities. Legislation like raising the minimum wage to at least $17 an hour and protecting workers’ right to unionize will boost the economic security of Black workers. In order to accomplish these goals, fiscal and monetary policy need to work in tandem so that the benefits gained by the Federal Reserve’s actions to maximize employment are supported and sustained by legislation.

One of the primary demands of the March on Washington was a national minimum wage that provided an adequate standard of living. March organizers indicated that anything less than $2 an hour—$19.53 in 2023 dollars—would be insufficient. Today, the federal minimum wage has remained stalled at $7.25 since 2009. Black workers are more likely to be employed in jobs paying the minimum wage and less likely to work in states or localities that have passed a state minimum wage that is higher than the federal minimum wage (EPI 2019; Wilson 2019). Raising the minimum wage to at least $17 an hour would greatly benefit Black workers and their families. The Raise the Wage Act of 2023 would achieve this.

Similarly, the Protecting the Right to Organize (PRO) Act would also benefit Black workers by making it easier for workers who want union representation to organize. Today, Black workers are the most highly unionized racial/ethnic group in the labor force. The PRO Act would bolster the National Labor Relations Act with new provisions that would prevent employers from exploiting legal loopholes to suppress and impede negotiations with their workers. These protections are critical for Black workers to build power in their workplaces and safeguard their labor rights (Economic Policy 2021a).

Fiscal policy measures like those mentioned above work in tandem with monetary policy decisions, which can affect wage growth and unemployment levels. The Federal Reserve’s monetary policy decisions play a major role in determining how much wage growth Black workers experience and how high or low unemployment levels go. Recent revisions to the central bank’s long-run goals and policy strategy have demonstrated the impact monetary policy can have on racial economic inequality. For example, Fed monetary policy decisions to keep interest rates low for an extended period during the long recovery from the Great Recession helped to bring the monthly Black unemployment rate down below 6% for the first time in the months before the COVID-19 pandemic (Bernstein and Jones 2020; Bivens 2021).

Fair access to housing and wealth

For decades, the racist practice of redlining—rejecting applicants who want to purchase homes in neighborhoods deemed “riskier” for lenders and related forms of discrimination—played a significant role in systematically denying Black families the opportunity to build wealth through homeownership. Redlining perpetuated racial segregation and stifled economic mobility for marginalized communities by means of discriminatory lending and housing policies. This historical legacy continues to cast a long shadow, contributing to persistent wealth disparities between Black Americans and other Americans.

Experts on the history of the racial wealth gap argue that slavery, Jim Crow laws, and the enduring patterns of discrimination, call for nothing less than a direct federal reparations program for descendants of enslaved people to close the gap (Darity and Mullen 2020; Darity, Mullen, and Hubbard 2023). Other strategies to advance racial equity in asset distribution, including policy initiatives like baby bonds and the expansion of federal housing programs, can also be instrumental in narrowing the wealth gap and promoting economic inclusivity.4 By acknowledging the historical injustices and systemic discrimination Black communities have faced, reparations can serve as a targeted mechanism for redressing the accumulated economic harm. A reparations program would not only acknowledge the past—it would also provide a tangible path toward greater equity and justice in asset ownership.

Additionally, the correction of inequities in home appraisals through policy solutions is of utmost importance, particularly for Black homeowners. Home appraisals are intended to provide an impartial and fair evaluation of a property’s market value during the homebuying and lending process. This assessment allows lenders to make informed decisions about the property’s risk. However, the presence of bias in home valuations, specifically affecting Black and brown households, creates a significant hurdle for these families, depriving them of the full financial advantages that come with homeownership and further widening the existing racial wealth disparity.

To tackle this issue, the Biden administration established the Interagency Task Force on Property Appraisal and Valuation Equity (PAVE), aimed at developing transformative measures to eradicate racial and ethnic bias in home valuations. The proposed actions include enhancing oversight and accountability within the appraisal industry, preventing algorithmic bias in home evaluations, and harnessing federal data and expertise to inform policy, practices, and research related to appraisal bias.

By implementing the policy recommendations outlined in the Action Plan, PAVE strives to foster equitable homeownership opportunities for all Americans, bridging the racial wealth gap and promoting financial stability for Black and brown households.

The Homes for All Act addresses the civil rights era demand for fair and affordable housing.5 By allocating over $800 billion over a decade to construct more than 12 million affordable housing units, this comprehensive legislation can pave the way for tangible progress. The bill’s provision to build over 8.5 million public housing units would provide accessible and good quality housing options for low-income and marginalized communities. Also, the bill’s provision to invest $200 million in the Housing Trust Fund would support the development of 3.5 million new private affordable housing projects for low- and extremely low-income families. By expanding affordable housing options and promoting homeownership opportunities, the Homes for All Act can foster equitable homeownership opportunities and economic stability among low- and moderate-income Black American households in particular. Making the dream of homeownership accessible to more families incorporates housing equity in a broader strategy to address racial wealth disparities.

Basic rights and freedoms

Essential rights and freedoms include access to voting and freedom from overpolicing. Despite the protections established during the civil rights era, voting rights for Black Americans face relentless attacks in many states. Gerrymandering, voter ID laws, voter roll purges, and other suppression tactics disproportionately impact minority communities and hinder their access to the ballot box (American Civil Liberties Union 2021). The John Lewis Voting Rights Advancement Act is a critical policy to safeguard the fundamental rights and freedoms of Black Americans. By restoring voting rights protections that have been eroded, this legislation would empower the Department of Justice (DOJ) to monitor and review changes to voting laws in jurisdictions with a history of racial discrimination.6 Under the proposed preclearance process, these jurisdictions would be required to seek permission from DOJ before making any alterations to their voting rules. This proactive approach is vital to ensuring equal access to the ballot box and protecting against potential voter suppression tactics that disproportionately affect marginalized communities.

Further, excessive policing and surveillance infringe on the basic rights and freedoms of Black Americans. Racial profiling, excessive use of force, and biased surveillance practices disproportionately harm Black communities, eroding their sense of safety, dignity, and fair treatment. The overpolicing and surveillance of Black Americans have perpetuated a cycle of distrust, fear, and systemic injustice that restricts their ability to freely exercise their rights.

Policymakers should direct more public resources toward mental health services, explore community-engaged approaches to public safety, and reduce penalties for minor non-violent offenses. Prioritizing mental health services would be an acknowledgment that few members of law enforcement are professionally equipped to handle public health issues. Community-engaged approaches to public safety would acknowledge the systemic issues surrounding overpolicing and its disproportionate effect on Black Americans that have fostered adversarial relationships with traditional policing in communities of color. Decriminalizing minor offenses can also help blunt the adverse consequences of biased law enforcement practices.

These policy recommendations collectively reflect a comprehensive approach to safeguarding the basic rights and freedoms of Black Americans.

Conclusion

In the decades that followed the civil rights era, policymakers struggled to uphold the principles of equality, equity, and freedom in practice. Despite the enactment of some well- meaning policies, the legislation passed over several decades has largely failed to address major inequities. Policymakers have created incremental additions to civil rights legislation and anti-discriminatory laws, enacted potentially meaningful programs that were inadequately funded or enforced, or deliberately undermined civil rights era laws to maintain racial economic disparities.

The cyclical consequences of these policies have caused generational harm apparent in the persistent racial disparities in economic and social outcomes presented in this report. The government’s failure to enact bold policies has permitted stubborn vestiges of white supremacy to linger and undermined American ideals of equality, opportunity, and prosperity for all.

Today, Black workers continue to fight for economic and racial justice in the workplace, labor market, and society. While incremental progress has been made, it is insufficient when racial justice is the goal.

Policymakers must recognize the failure of past policies to achieve the desired outcome of addressing systemic racism. They must acknowledge the insufficient strides taken to reverse inequity. And they must count the moral and economic cost of structural racism. Without comprehensive, race-conscious policies, lawmakers will continue to repeat the mistakes of former administrations and perpetuate inequality.

Notes

1. Job Training Partnership Act, H.R. 5320, 97th Cong. (1982).

2. The employment rate for Black WIOA participants in the second quarter after exit was 73.8%. The employment rates for the same period were 73.5% for Hispanic workers, 71.1% for white workers, and 69.1% for “Other” workers.

3. Housing and Community Development Act of 1974, S.3066, 93rd Cong. (1974). U.S. Department of Housing and Urban Development, Section 109 of the Housing and Community Development (HCD) Act of 1974 (web page), accessed on February 15, 2023.

4. The Baby Bonds policy, as proposed in Cory Booker’s Opportunity Accounts program, aims to establish individual accounts for every child in the United States. These accounts would be initiated with an initial deposit ranging from $1,000 to $3,000, with the amount varying based on the child’s family income. Each year, additional contributions would be made to these accounts based on the family’s income, continuing until the child reaches 18 years of age. At that point, the funds in the accounts could be utilized for specific purposes, such as education, homeownership, or retirement.

5. Homes for All Act of 2021, H.R. 7191, 117th Cong. (2021).

6. John R. Lewis Voting Rights Advancement Act of 2021, H.R.4, 117th Cong. (2021).

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Speaker McCarthy’s proposal would slash spending across federal programs for the next decade, cutting federal resources for everything from child care programs to environmental protection safeguards. If these deeply unrealistic spending cuts actually came to pass, the human toll would be enormous, and economic growth would be deeply damaged.

The McCarthy proposal also resurfaces a completely inaccurate but alarmingly persistent conservative claim: the idea that government anti-poverty programs are unnecessarily generous, bloated, and are keeping people out of the workforce who should otherwise be supporting themselves entirely through income earned in the labor market. The proposal seeks to severely restrict access to Medicaid health coverage and food stamps by imposing onerous requirements to prove that recipients are working or looking for work. Past evidence about these types of burdensome reporting requirements shows clearly that they will not actually lead to increased employment but will deprive vulnerable families of vital support.

Income support programs are not keeping people out of the workforce

The implicit claim that the U.S. labor market is hobbled by a too-generous welfare state is awfully hard to see in the data. Job growth in 2021 and 2022 hit its highest two-year stretch in the nation’s history. The unemployment rate is currently at a near-historic low. The prime-age employment-to-population ratio hit its highest point in March 2023 in more than 20 years. In general, many low-wage workers have seen the benefits of a tight labor market in the pandemic recovery, as employers have raised wages to attract and retain workers. In short, when jobs are available, workers have rushed to fill them. And while food assistance programs and other safety net supports are a vital lifeline to keep many out of poverty, the benefits are nowhere near enough on their own to fully support the cost of living for many families. Where has the idea come from that there’s an urgent need to address these supposedly too-comfortable benefits keeping people out of the workforce?

The premise of adding more onerous work and reporting requirements is also based on an inaccurate picture of who currently receives federal assistance through these programs. As the Center on Budget and Policy Priorities recently noted, nearly two-thirds of adults with Medicaid already work. Since the early 2000s, many safety net and income support programs have actually shifted toward requiring proof that recipients are also working or looking for work, but the gains of this shift have been near-impossible to see in terms of increased employment. Since 1990, all new investments in safety net spending have gone toward families with at least some labor market earnings. Those who are unable to find or do work under the current requirements are already in extremely difficult circumstances, and taking away the few safety net supports they have available would be economically devastating.

The U.S. safety net is in serious need of reforms, but not because of inaccurate claims that its excess generosity keeps people out of work. The biggest problem with the U.S. safety net is that our programs don’t help as many people, or as effectively, as they should. Public spending in the United States as a share of GDP is extremely low relative to other rich nations, and we spend far less to fight poverty than other comparatively wealthy countries. Low-income people already spend a ridiculous amount of energy attempting to prove and maintain their eligibility for these modest supports.

Imposing additional “work requirements” would restrict access to Medicaid and food stamps

Burdensome work reporting requirements are about making the benefits system more sluggish and difficult to access, and do nothing to boost employment. Existing reporting requirements already impose too-high a bureaucratic burden to accessing needed help. Passing these more burdensome requirements being called for by Speaker McCarthy would require people in need of assistance to devote even more of their bandwidth to dealing with forms and make-work bureaucratic tasks, rather than spending that time and energy looking for good work in meaningful and productive ways. The solution should be to reduce the amount of “means-testing” required and to make programs more readily accessible, not to restrict them further.

Further, Speaker McCarthy’s claims that this proposal would put the United States on a path to “fiscal responsibility” and lower inflation are laughable. The biggest driver of deficits for the last 20 years has been a steady trend toward ever-larger tax cuts for corporations and the richest U.S. households. No one who actually wants to reduce the federal deficit should be looking to do that on the backs of the poorest and most vulnerable Americans.

The strongest “incentive” that people have to enter or reenter the workforce already exists—they need income to survive and provide for themselves and their families. If they’re not already working but want to, there is likely a very good reason. Many people simply can’t afford or access quality child care, or quality care for other family members, and need to take on those responsibilities themselves rather than entering the paid workforce. People with disabilities may struggle to find jobs that accommodate their needs appropriately, or that provide adequate health coverage. Many can’t find jobs with the fair and predictable scheduling they need. Others may stay out of the workforce because of a persistent lack of economic opportunities available in their neighborhoods, towns, or cities—a lack of opportunity often caused by systemic public and private disinvestment in communities of color or rural areas.

Any policymaker serious about getting people who want to work into the workforce should be looking to address these problems, rather than taking away lifelines to food and health care.