Trump’s Black unemployment claims don’t tell whole story

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Washington was abuzz with chatter and concerns over President Trump’s moves on Iran and North Korea.

But White House officials and allies spent much of the week quietly touting lower unemployment numbers as a sign of Trump administration achievements on the economic front.

Of some particular significance were Black unemployment numbers: while still nearly double the national official Bureau of Labor Statistics average of 3.9 percent, jobless claims by African Americans are now down to 6.6 percent, more than 1 percent less than what it was in January.

Faced with challenging Congressional midterm prospects, Republicans were quick to point out the latest Black unemployment numbers as proof that signature legislative items such as tax reform were working.

Yet, even as the economy added 164,000 jobs, that number was below economist expectations or hopes for a more dramatic upswing. Other analysts openly worried that wage growth was stubbornly flat as the annual rate of pay increases stood flat at 2.6 percent.

There were also skeptics on the declining Black jobless numbers. National Urban League president Marc Morial, who was in Washington that same week releasing the latest annual State of Black America report, was quick to point out that the Black jobless rate was not only double that of the overall jobless data, but still very much behind white, Asian and even Latino jobless rates.

It’s an indication, said Morial, that “there is implicit and explicit bias in the labor market.”

That underscored a major theme touched on throughout the week as the NUL held its annual policy convening.

Observers expressed particular anxiety over how much the increasingly digitized marketplace would impact Black workers and families struggling to keep up.

“Jobs are going to disappear. Certain types of jobs are going to disappear, and new jobs are going to emerge,” Morial said.

Creative Investment Research’s William Cunningham, however, expressed mixed optimism.

“Bottom line is that this economy is strong, one of the strongest we’ve seen,” Cunningham said. “Black unemployment is at a historic low. Of course, many of these are low wage jobs in food service, but some are in high skilled areas like construction.”

Since the dawn of the Trump administration, analysts have wrangled over the precise dimensions of the Black unemployment rate.

While the latest BLS numbers might show a substantial decrease (that rate was about 6.9 percent as reported in April), that’s not counting the labor participation rate — the number of people employed and the number actively looking for work.

A Tribune analysis of labor participation rates, those have declined from nearly 68 percent in 2000 to just 62.8 percent in 2018.

White labor participation matches national averages; for white males 20 years and over, it’s over 72 percent.

But for African Americans, the labor participation rate is 61.9 percent — slightly lower than the national average and way below the white participation rate.

Even the Latino participation rate, at 66.4 percent, and the Asian participation rate, at 63 percent, are much higher.

Hence, nearly 40 percent of African Americans able to work are on some level not participating in the labor market with many out of work or not actively seeking work due to a variety of circumstances.

Black workers account for just over 12 percent of the national labor force, proportional to their official population count.

 They are over 10 percent of the labor force in Pennsylvania. But the growth of their participation in that market continues to be slow. “Although Blacks’ labor force growth rate is not as rapid as in past decades, their share of the labor force has increased from 9.9 percent in 1976 to 12.3 percent in 2016,” notes BLS economists Emily Rolen and Mitra Toossi.

“This increase is expected to continue, reaching a projected 12.7 percent by 2026.”

Cunningham points out the lowered participation rate may be a sign of people taking time off before looking for a new job. But there are signs suggesting the official Black unemployment rate could understated.

Typical BLS unemployment tallies don’t included the so-called “U-6 rate” that measures three types of discouraged workers: short-term, those on the margins of the workforce and those forced to work part time. Once those latter factors are counted, the national unemployment average, in its complete assessment, is nearly 22 percent.

According to Tribune analysis of BLS and Federal Reserve data, it has been hovering over 20 percent since 2010.

If the national unemployment rate is actually near 22 percent, the real Black unemployment rate is over 36 percent.

In Philadelphia, the official BLS unemployment rate is 5.3 percent for April 2018; however, if other factors were assessed outside the BLS official rate, overall unemployment in the city may actually be near 30 percent. That would make the real or “U-6” Black unemployment rate somewhere near half.

For Black men and women who are 16-19 years of age, the labor participation rate is actually 29 percent, which means more than 70 percent of young African Americans are not participating in the labor force.

That’s compared to nearly 40 percent of whites in the same age group.

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