Black-White Income Gap Re-Widens

Years of progress at narrowing the income gap between black and white workers were dealt a significant setback by the most recent recession and slow jobs recovery.

How large a setback was it? Today’s Economic Policy Institute snapshot, by senior economist Jared Bernstein, tackles that question. He shows that on the strength of the full-employment economy of the latter half of the 1990s, black median income rose from 61% of white income in 1995 to a historically high ratio of 63.5% in 2000 and would have, if unemployment had not risen, reached 63.9% in 2004.

Instead, the recession and its aftermath of sluggish job growth caused the gap to expand again, and the ratio of black to white income fell back to 62.0% in 2004. That 1.9 percentage point difference translates to an income loss for the typical black family of over $1,000 in 2004 alone.

Today’s snapshot previews data to be presented as part of The State of Working America, 2006-2007, which will be available to journalists in August for Labor Day Weekend release.