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Unemployment for Black Women is on the Rise. Here’s What Economists Have to Say
The unemployment rate for Black women has increased over the last few months.
While the current national average unemployment rate stands at 4.1%, the rate for Black women hovers nearly two percentage points higher. It’s also nearly three percentage points higher than that of White women.
The unemployment rate for Black women was 5.1% in March, 6.1% in April, 6.2% in May and 5.8% in June.
“If we look at the various industries we know that Black women are overrepresented, considering their proportion of the U.S. population, they’re overrepresented in health care jobs, and we see this increase between May and June of jobs involved in health care and particularly in caretaking of elderly people,” said Kristen Broady, senior economist, advisor and director of the Economic Mobility Project at the Federal Reserve Bank of Chicago.
Some economists say the increase in unemployment could be a sign of a tighter job market overall, and others believe this current trend could be a result of recent cuts in the federal workforce and DEI positions due to the Trump administration’s purge and executive order.
According to the U.S. Equal Employment Opportunity Commission, Black women made up 11.7% of the civilian federal workforce, almost twice their participation in the national civilian labor force.
“There’s a perception when someone gets a government position, that’s a position you hold for quite some time,” said Brian Thompson, clinical professor of economics at DePaul University. “People tend to gravitate towards safety. I would also argue that it’s an area where they could potentially expect there to be diversity in selection of roles, and they would have a better opportunity to be promoted and so forth.”
According to a New York Times tracker of federal job cuts, the U.S. Departments of Education and Health and Human Services have experienced some of the largest cuts. The Department of Education has been reduced by 46%, while HHS has been reduced by 24%.
However, it remains unclear how many jobs lost in the federal government were held by Black women. Economists say the information gathered from the current trends of unemployment raise more questions rather than answers.
“I think a good question is who is making the decisions in terms of terminations, and how are those decisions being made, and what is the criteria for those decisions?” Thompson said. “If those decisions are made based on objective information, performance data and so forth, I think it becomes much easier to kind of digest the information. But if it’s more subjective in nature, they’re not necessarily accountable for how those decisions are made. I think that’s where a bigger concern lies.”
For the last 20 years, the unemployment rate for Black women has remained 2.2 percentage points higher than the national average.
Broady said the slight decrease in the unemployment rate for Black women in June could be attributed to 39,000 jobs opening within the health care sector. Nursing positions saw an additional 2,800 jobs, and residential care facilities saw an additional 14,400.
The last large job decline for Black women was during the pandemic.
“The rate for Black women was around 14%,” Broady said. “We saw a loss of around 20.5 million jobs during that time period, and it affected everybody, and it’s not just because they were Black or Latino. You have to look at front-facing customer jobs, your cashiers, your retail sales people. When businesses closed, all over those customer-facing jobs were laid off temporarily, permanently, businesses closed. When we break them down by race, we do see an overrepresentation of Black and Hispanic women.”
Issues like unemployment contribute to disproportionate wealth and economic mobility for Black and Latino households. Data from the Federal Reserve System shows between 2019 and 2022 the median wealth for White households was $285,000. It was $62,000 for Latino households and $44,890 for Black households — an increase from $27,970.
“The racial wealth gap is not determined by just one thing,” Broady said. “Changing or improving just one of those things is not going to change the racial wealth gap. But policymakers can look at any and all of those facts and statistics to decide how they can collaborate across different groups, philanthropy, higher education, state and local government, etc., to work on those policies.”
Thompson also believes a lack of education about smart investments within the Black community contributes to the growing racial wealth gap.
“I think that there’s a fair amount of opportunity in educating people of color about how investments work,” Thompson said. “It is less of a ‘How can I get rich overnight?’ type of situation, and more about, ‘How can I increase my wealth over time and become less reliant on one particular income stream coming into the household?’”
