Addressing the Black Job Crisis

As Barack Obama’s second term begins, the black community still faces a “two-dimensional” job crisis, confronted by disproportionate levels of both high unemployment and low-wage work. In April 2013, black unemployment stood at 13.2 percent, while white unemployment was just 6.7 percent.

In addition, a not yet released study by the University of California Berkeley Center for Labor Research and Education examined the situation facing low-wage black workers in several cities.  From 2009 to 2010, it found that 14.3 percent of black men and 16.7 percent of black women in Los Angeles who worked full-time were low-income. In Philadelphia, the figures were 22.6 percent and 29.6 percent, respectively, and, in Chicago, they were 26.9 percent and 34.1 percent.

To tackle the persistent problems of unemployment and low-wage work in the black community, the country needs to alter its approach to solving these challenges.
 
To reverse this dangerous trend, we must move away from a number of old practices that have failed to address the jobs crisis in the black community. Our anti-poverty policy portfolio must encompass strategies that have the dual effects of creating jobs and raising wages.  Too often, we seek to only solve one predicament and, as a result, both problems persist.

There are four broad changes that will allow us to successfully tackle the crisis.

The first is full-employment macroeconomic policies.  We cannot end poverty when the national economy is underperforming. What are needed are expansionary fiscal policies such as tax cuts and/or subsidies for low- and middle-income families, assistance to cash strapped state and local governments, and direct federal job creation programs.

Second, we need broad labor market interventions in order to raise basic wage standards.  To maintain its inflation-adjusted value from forty years ago, the current federal minimum wage of $7.25 should be $10.58. Restaurant workers۪ federal tipped minimum wage is just $2.13. It is essential that Congress raise these standards. 

In addition, numerous studies have documented the violation of basic labor standards such as minimum wages, overtime pay, and lunch breaks.  Anti-poverty policy efforts should embrace attempts to combat these instances of wage theft.  And we must support the right of workers to organize unions so they have the power to engage in collective action to protect and expand their rights on the job.

Sector-specific interventions are the third part of the solution. Certain industries must be restructured in order to increase their employment of particular demographic groups that traditionally face high unemployment.  Such interventions must also facilitate higher labor standards. Examples include community workforce agreements that combine local hire provisions with project labor agreements that preserve job quality on construction projects, responsible contracting agreements that ensure that any public sector outsourcing doesn۪t sacrifice product quality, and community benefits agreements that increase the local hire policies that affect construction and permanent operations employment.

Finally, we must increase the capacity of communities to intervene in the job market.  Ways to accomplish this goal include community-based job training programs that can link program graduates to specific employment opportunities in industries that pay well and have internal career ladders.

We can also increase capacity by creating and fostering community job centers that act as hiring halls/dispatch centers for publicly-financed economic development projects. Employers could be required to use these job centers for a certain proportion of new employees. We could also establish black worker centers to organize black workers on jobsites and facilitate collective action when racial discrimination is present or labor laws are violated.

It۪s also worth noting that another significant way to increase community capacity would be to facilitate the ability of low-income workers to form unions.

Once we employ these changes, we will move away from simply “fixing people.” We will begin to “fix structures” that have been hurting the black community for too long  By continuously ignoring the structural causes of poverty, we have undermined the effectiveness of our anti-poverty efforts.

Yet a change in approach can help communities and individuals to fix broken societal structures. Now is the time to allow low-wage black workers to take control of their lives, their job prospects, and their future financial stability.

To print a PDF version of this document, click here.

Steven Pitts is a labor policy specialist at the University of California Berkeley Center for Labor Research and Education.

The views expressed in this commentary are those of the author or authors alone, and not those of Spotlight. Spotlight is a non-partisan initiative, and Spotlight۪s commentary section includes diverse perspectives on poverty. If you have a question about a commentary, please don۪t hesitate to contact us at info@spotlightonpoverty.org.