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Michael Hiltzik: Black unemployment is rising again, undermining a Trump boast on economic growth

Michael Hiltzik, Los Angeles Times on

Published in Business News

One aspect of American life that President Trump never tires of taking credit for is economic growth -- specifically, job growth. So you won't hear him pointing out the disturbing discrepancy in the employment figures between white and black workers.

Economists and economic commentators have started to notice however, because it's hard to miss. Over the last several months, as the white unemployment rate has continued to trend lower, the black unemployment rate suddenly has turned higher.

That knocks one of Trump's economic talking points for a loop. In January 2018, he hared off after a critic, the rapper Jay-Z, on Twitter, boasting that he was creating an economic nirvana for African-Americans.

"Somebody please inform Jay-Z that because of my policies, Black Unemployment has just been reported to be at the LOWEST RATE EVER RECORDED!" Trump tweeted.

Monthly unemployment readings are notoriously volatile, but the divergence also can be seen in multi-month averages. The trend contradicts one enduring truism about black and white unemployment rates -- that although black unemployment is consistently higher than the statistic for whites, the gap narrows as unemployment falls. In months dating back to late 2018, total unemployment has generally fallen but the black-white gap has widened.

"The employment prospects of Black men may actually be deteriorating even as the overall labor market continues to improve," progressive economist Dean Baker noted last week.

 

The gap points to a question that should be raised more consistently: Who does the Trump economy serve? Macroeconomic statistics have been strong, as has the stock market. But the benefits of this economic expansion have been funneled overwhelmingly to the rich. They received most of the tax cut Trump signed in December 2017, and they've received tens of billions in payouts from corporations enjoying the tax cut in the form of stock buybacks and dividends.

Meanwhile, the middle- and working-class are about to take the cost of Trump's trade war in the slats. As my colleague James Peltz reported Monday, tariff-driven price increases will affect apparel, footwear, toys and electronics, creating yet another tax on average consumers.

It's also possible that the recent reversal is short-lived, and that black unemployment soon will continue its longer-term decline. As it happens, the reasons for the uptick in black unemployment are hard to pinpoint. It doesn't appear to result from a surge of black workers into the job market, a phenomenon that can push the unemployment rate temporarily higher. The black participation rate -- the share of eligible workers in the workforce, was 62.5% in October, and 62.5% in April.

Baker conjectures that a lack of enforcement of anti-discrimination laws under the Trump administration may play a role. "Having a president who seems to think that white men, starting with himself, are the biggest victims in society could be part of the problem," he wrote. "This may encourage many employers to think that it is okay to discriminate again."

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