For Black Americans, economic progress, but no gain

UNSPLASH

A study from the Joint Center for Political and Economic Studies and Center for Economic and Policy Research found that Black Americans are earning more money, but not closing the income gap to their white peers.

Black Americans are making economic progress, but income inequity remains.

A brief from the Joint Center for Political and Economic Studies and the Center for Economic and Policy Research, "The Best Black Economy in Generations – And Why It Isn’t Enough," shows that for improved employment and lower poverty rates, there is a persistent racial wealth gap.

Even with relative prosperity in recent years, the authors wrote, Black Americans as a whole still trail their white counterparts by a wide margin.

“The stark reality is that despite recent economic gains, the pace of progress in closing the racial wealth divide remains alarmingly slow," said Dedrick Asante-Muhammad, president of the Joint Center for Political and Economic Studies and co-author of the brief. “Without significant and targeted policy interventions, it could take centuries to achieve true economic equality between Black and white Americans — an unacceptable timeline that demands urgent action.”

The study found that:

• Prime-age employment in the first half of 2024 was historically high at 78% and Black median household income – $53,000 – was the best in a generation.

• Median Black household net worth in 2022 was nearly $45,000 — more than twice the low point of $17,000 in 2013.

• Unemployment in 2023 was a record low 5.5% — nearly half of the average rate in the previous 40 years.

• Black median wealth is less than a quarter of the $190,000 estimated to be at the lower end of middle class wealth and the $53,000 median household income is 30% less the $75,000 for Americans as a whole.

At the current rate of economic inequity, the authors predict it would take more than 500 years to bridge the Black/white income divide, and nearly 800 years to close wealth inequality.

The study’s authors conclude that while Black wealth has increased, there’s a long way to go before approaching the white median wealth level of $285,000. On average, white households have more than six times the wealth of Black households.

“While there has been undeniable progress in the Black economy over the last decade, it’s deeply concerning that these advancements aren’t met with the urgency and action needed to address the root causes of African American economic insecurity,” said Algernon Austin, co-author of the brief and director for race and economic justice at CEPR. “Racial inequality, at its core, is driven by economic disparities, and unless we center these issues in our national discourse and policymaking, we risk perpetuating a divide that could take centuries to close.

“It’s time for leaders to engage with the critical analyses provided by Black scholars to make meaningful strides toward true economic equity.”

Black Americans have expressed conflicted points of view about the state of the economy. In a 2023 Pew Research poll, 27% of respondents considered economic conditions excellent or good, while 67% were optimistic about their financial future according to a Joint Center for Political and Economic Studies poll.

The respondents’ primary economic concerns were inflation, high interest rates, and a lack of funds to invest.

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