Editor’s Note: One of Tuesday’s State of the Union applause lines came when President Trump said, “Something I’m very proud of: African-American unemployment stands at the lowest rate ever recorded.” He had made the same claim days before, after rapper and business mogul Jay-Z expressed some cautionary comments about black prosperity on CNN’s The Van Jones Show. The remarks prompted Trump to scold Jay-Z with a tweet claiming that his year-old administration was responsible for black unemployment being at an historic low.
On the eve of the State of the Union address, Erin Aubry Kaplan spoke with economist Steven Pitts about the president’s claim. Pitts is the associate chair of the University of California, Berkeley’s Center for Labor Research and Education; his field of focus is on issues of job quality and African-American workers.
We need to do two things: Maintain current levels of employment and fend off growing attacks on public sector unions.
Erin Aubry Kaplan Can the Trump administration take any credit for the new low figures in black unemployment?
Steven Pitts No. The downward trajectory of the black unemployment rate has many factors, but basically it’s a function of the economic expansion of the last six or seven years—that’s what we’re seeing. It’s not because of a policy enacted by Trump or even by Obama — that would be giving a single person too much credit. If there had been a sharp break in the trajectory—if it fell to one percent, say, in a short period of time– we could maybe say it was something someone did.
Did anything in Obama’s eight years in office aid black employment specifically, or indirectly?
Steven Pitts When Obama took office, all hell was breaking loose. A combination of his stimulus package–even though it was too little–actions taken by the Federal Reserve and other factors helped to start expanding the economy after it bottomed out. We’ve had a steady upward trend since. The black unemployment rate has been falling since roughly June of 2011.
Lower unemployment for black folks is certainly good news, but there’s a troubling story underneath the numbers. Do you see the story changing substantially anytime soon?
Steven Pitts You’re talking about job quality — what kinds of jobs people have and what kind of quality of life they help provide. So the unemployment rate is the lowest it’s been since 1972. But basically since the mid ’70s we’ve had flat wage growth, and growth has been very, very slow for all folks. Of the top-10 fastest growing occupations, seven or eight fall below the median wage in the state. We see an expansion of jobs in the service sector — janitors, those sorts of things. Black people are also historically employed in the public sector, which is why the fate of the public sector is so important. We need to do two things: Maintain current levels of employment and fend off growing attacks on public sector unions. One thing that made jobs good for black people was unionization.
We’re never going to have a black Walmart, it’s never going to happen. We aren’t in a separate society.
We tend to see the black labor problem as another black/white disparity, another example of inequality. A lot of times our basic metric of black well-being is how big is [its] disparity with whites. But that’s processing data wrong. If you ask a black person who’s struggling how they’re doing, they’ll say okay, but they’re not thinking about inequality or how they compare to white folks. Basic well-being is asking the questions, How are people living? Do they have good wages, good jobs? It’s not complicated, but we don’t tend to look at it this way. Not that inequality shouldn’t be noted — it should. But that’s not all we should look at.
What about the black middle class? We hear a lot about poverty and unemployment, but how are the technically better- off people faring?
Steven Pitts The middle class is facing a lot of problems. Blacks were disproportionately hit by the subprime home loan crisis, so if you’re trying to buy a house in California, it’s tough. They come out of college with huge debts, maybe have to take out a second mortgage. Their status is a function of three things: the trajectory of the economy, the government policies to impact that trajectory and the state of community organizing—people power. Overall, things don’t look good right now.
In his conversation with Van Jones, Jay-Z talked about the limits of black capitalism—he said that money doesn’t make you “happy,” meaning that a few black millionaires like himself can’t solve deep problems of racial inequality, which includes employment. Do you agree?
Steven Pitts Black capitalism is not part of the solution. Even if every black millionaire is willing, they can’t help every black person in the world. The scale is insufficient to the problem. When we talk about black entrepreneurs we tend to ignore other dimensions around the economy. We’re never going to have a black Walmart, it’s never going to happen. To the extent that small firms get beat down by Walmart, black firms get beat down too. We aren’t in a separate society. By the way, you have only one Walmart, not a lot of “white” Walmarts running around. We could talk about more black suppliers to Walmart, but that’s determined by Walmart, and then you’d have to talk about their labor practices.
Rather than celebrate the low unemployment rate, should the president and other national leaders officially declare black employment a national crisis?
Steven Pitts It is a national crisis. A president should represent all the people and respond to the crises of those people. But that’sshould. Reality is different.
Erin Aubrey Kaplan
Capital & Main