What Trump isn’t saying about black unemployment

Columnist
Yahoo Finance

President Trump is proud, apparently, of improving prospects for African-Americans and Hispanics.

“The African American unemployment rate fell to 6.8%, the lowest rate in 45 years. I am so happy about this News!” Trump tweeted on Jan. 6. “The Hispanic unemployment rate dropped a full point in the last year and is close to the lowest in recorded history,” he added two days later.

Trump’s right: The unemployment rate has fallen to 6.8% for blacks and 4.9% for Hispanics. The overall unemployment rate is a remarkably low 4.1%, with the trend improving in all racial categories.

What isn’t improving much is pay. Median weekly earnings for blacks, adjusted for inflation, have risen just 2.5% since 2000, and a scant 0.7% since 2010. So a typical worker earning $1,000 per week in 2010 would be earning $1,007 8 years later. Since that’s adjusted for inflation, it represents progress—but barely enough to measure.

Pay has generally been stagnant across the board, with real earnings for all racial groups inching up just 3.9% since 2000 and 0.9% since 2010. But gains have been smallest for blacks. The chart below shows median weekly earnings for 4 racial categories. For those who can’t make out the color codes, the line representing Asian is on top, followed by white, all groups combined, African-American and Hispanic:

Source: St. Louis Federal Reserve Bank, Bureau of Labor Statistics
Source: St. Louis Federal Reserve Bank, Bureau of Labor Statistics

And here’s the change in unemployment rate by race, with African-American on top followed by Hispanic, all groups combined, white and Asian:

Source: St. Louis Federal Reserve Bank, Bureau of Labor Statistics
Source: St. Louis Federal Reserve Bank, Bureau of Labor Statistics

Trump has taken credit for all the positive trends in the economy, even though the pace of job creation during the first year of his presidency slowed a bit from prior years. With unemployment so low, economists expect wage growth to pick up, since companies will have to pay more to keep and recruit workers who now have an easier time finding another job. But they’ve been predicting that for several years, and it hasn’t happened yet.

In his Jan. 8 tweet, Trump suggested blacks and Hispanics are better off with him in the White House than they would have been with Democrat Hillary Clinton. “Dems did nothing for you but get your vote!” Trump declared. Trump won just 8% of the black vote and 28% of the Hispanic vote, and if he runs for reelection in 2020, he might need to do better with each group. Those tweets are the start of a campaign pitch.

Confidential tip line: rickjnewman@yahoo.com. Encrypted communication available.

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Rick Newman is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman

 

 

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