The coronavirus has set America’s Black labor force back more than 40 years.
Since the mid-1970s, the share of African Americans working or actively looking for a job has consistently stayed above 60%. But back in April, when the world was still gauging the early economic fallout of Covid-19, the Black labor force participation rate plunged to 58.6%, the lowest level since 1974. Though it has since come off those depths, the rate remains below 60%.
Economists see this as a worrying indicator of the disparate recovery between Black and white workers. While the labor force participation rate for white Americans took a similar dive earlier this year, it didn’t sink as low.
Both the Black and white rates improved somewhat after their low points in April, and both fell again in September. But white participation in the labor force dropped only a tad to 61.6% from 61.8% in August. The Black rate, meanwhile, took a much bigger dip, from 60.4% to 59.7% in the same period.
One of the reasons is that Black Americans are much more likely to be employed in low-wage jobs in the hospitality and service industries, which were hard-hit in March and April, and which generally offer fewer options to work online.
And Black workers could be dropping out of the labor force to oversee their children’s online learning, which may help explain the September backslide. Black Americans have been disproportionately affected by the virus, and have therefore been more reluctant to send their kids back to school than white parents, polls show. Black parents also tend to have fewer resources to deal with school closures, making it harder to juggle childcare and work. For example, Black children are three times more likely to live with a single parent.
And then of course there is the illness itself. Black Americans are more likely than whites to get sick with Covid-19, which also may be reducing the labor force participation rate.
The historically low figures suggest unemployment among Black Americans might be even worse than official figures, according to Valerie Wilson, an economist with the Economic Policy Institute, a left-leaning Washington think tank. The Black unemployment rate was 12.1% in September, but it only includes people actually looking for a job, and ignores the unusually large numbers of Black people who dropped out of the labor force. Because the participation rate is based on the whole working-age population, it also sheds light on who isn’t participating, including those who want a job but have stopped looking.
Economists are worried that if Black Americans keep dropping out of the workforce, this will increase the number of the long-term unemployed—people out of work for more than six months—and make them much more likely to depend on social assistance.
Fixing this would require more than just adding back the jobs that were lost during the pandemic. “The longer it goes on, you’re actually needing to add more than just that were lost to keep up with the growth in the population of the labor force,” Wilson said.