Despite Progress Overall, Economic Quagmire Deepens for Blacks


About a week ago, Ernest, a 40-year-old husband and father of two girls, lost his job. For three years, the Baltimore man, who has a degree in accounting and years of experience, said he worked in a series of menial, part-time jobs because he could not find employment in his field.

About a month ago, he left his janitorial job for an office position that promised upward mobility, permanency and the ever-important benefits. But the light at the end of the tunnel turned out to be a train. The company that just hired him hit a rough patch and had to let him go.

Now, he is on the unemployment rolls again, and he and his family are living in a transitional housing facility operated by the nonprofit St. Vincent de Paul of Baltimore.

“As a man it hurts. I want to be provider. I want my family to have the best. I don’t want to depend on the government or anyone for assistance,” said the African-American man, who asked not to be identified by his last name. “I want a 401 (k), I want a pension plan, I want a health insurance plan, I want to pay my bills and take care of my family. [But] I’ve been having a hard time finding permanent employment.”

Sadly, Ernest’s story of unemployment, homelessness and poverty is becoming all too familiar, as reflected by a recently released U.S. Census Bureau survey on poverty, incomes and health insurance that bears witness to the ongoing toll of the Great Recession on American families.

“It’s not a positive report,” said Elise Gould, economist and director of health care research at the Economic Policy Institute in Washington, D.C. “All the trends in the data have been pretty flat. Incomes have not increased. The poverty rate has been pretty much the same the past couple of years. [And] it’s not a good place for it to settle because it is relatively high and that’s a sign that the recession has had a devastating impact.”

“The only group that has seen a return to some type of normalcy is the top 5 percent of Americans,” she added. “[But] economic growth that does not reach the vast majority of Americans is not real economic growth.”

In 2012, median household income in the U.S. was $51,017, an $83 decline from 2011 and an 8.3 percent decline from 2007, the year before the recession. This followed two consecutive annual declines, according to the bureau’s Current Population Survey.

Similarly, changes in the poverty rate were not statistically different for the second straight year. About 46.5 million people lived below the poverty line in 2012, representing 15 percent of the population—a 2.5 percentage increase from 2007.

When those numbers are categorized by race and ethnicity, the outlook becomes even grimmer, with African Americans continuing to exist in the lowest economic stratum.

“Consistent with other years, poverty rates are higher and median incomes are lower than other groups,” said Trudi Renwich, chief of poverty statistics at the U.S. Census Bureau.

Over the 12-year period from 2000 to 2012, Blacks’ incomes plummeted 15.8 percent, while Whites’ incomes dropped by 6.3 percent.

In 2012, Black households had a medium income of $33,321 compared to $39,005 for Hispanic households, $57,009 for White households and $68,636 for Asian households. Not surprisingly, then, a higher percentage of Blacks—27.2 percent or 10.9 million people—lived in poverty, compared to 25.9 percent of Hispanics, 11.7 percent of Asians, and 9.7 percent of Whites.
Gould, the economist, called the disparities “astounding.”

Sadly, however, the deep economic chasm separating the races in the U.S. has existed for a long time, said Hilary Shelton, chief of the NAACP’s Washington Bureau and the organization’s senior vice president for advocacy and policy.

“The real sad thing is that these numbers have not changed that much. It is very disturbing to see these persistent disparities in income and poverty for African Americans,” Shelton told the AFRO.

In Black meccas such as Baltimore and Washington, D.C., the trend bore out.
In Baltimore, the median income for African Americans was $30,511—a 14 percent decline from 2007—30.4 percent lived in poverty and 12.4 percent were unemployed.

In Washington, D.C., the trend among the general populace was good—it experienced one of the largest increases (23.3 percent) in median household income from 2000 to 2012, going from $53,995 to $66,583. But among the city’s Black residents, circumstances are bleaker. The median income of Black households dropped by 2 percent from $39,772 to $39,139 between 2007 and 2012. And, poverty rose from 22.7 to 25.7 percent.

Contrastingly, in Prince George’s County, Md., African-American poverty rates were relatively low, said the Census Bureau’s Renwich. Poverty rates among Blacks in that county rose from 8.2 percent in 2007 to 9.6 percent in 2012.

Shelton said the figures are not surprising since Blacks lost 50 percent of their wealth during the foreclosure epidemic and have unemployment rates that are twice that of Whites.

“It is this reality that weighs very heavily on the NAACP’s public policy agenda,” the activist said. “We’re fighting for programs that help people at their worst levels. The challenges of working class people in America are worse than ever before.”

But lawmakers—particularly Republicans on Capitol Hill—seem to lack the political will to serve the needs of the American people, Shelton added.

“What this report is clearly reflective of is a lack of policies to address the crucial concerns of real American people,” he said. “Too many [legislators] are focused on the next election rather than ensuring Americans have their next meal.”

For example, Shelton criticized House Republicans for their dogged attempts to repeal President Obama’s Affordable Care Act, even though it may have contributed to the slight bump in Americans that have health insurance, as the Census statistics showed. He also decried the inattention shown to the American Jobs Act, legislation that has been languishing in Congress for the past couple of years.

Gould, the EPI economist, also disparaged House Republicans’ recent vote to reduce the Supplemental Nutrition Assistance Program (SNAP) by 5 percent, or $4 billion a year. Food stamps are used by more than 1 in 7 Americans.

“It is criminal to cut back on food stamps, especially in light of this report,” Gould said.

“The idea of starving the government (cutting back on its spending) is the absolutely wrong direction for the country,” she added. Instead, there should be another stimulus “to create more jobs to ensure people at the middle and the bottom have more money in their pockets to spend and stimulate the economy.”

Given the continued acrimony and partisanship in Washington, however, Gould said she is not hopeful of a quick change in the nation’s economic forecast.

“I’m not optimistic,” she said. “In terms of poverty and income we have a long way to go in terms of getting back to a place where incomes are being evenly distributed across all groups.”

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Despite Progress Overall, Economic Quagmire Deepens for Blacks

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