The labor market isn’t nearly as strong as it seems — especially for Black Americans.
The official unemployment rate dropped to 3.6% in March, approaching its pre-pandemic low. But to count as unemployed, you have to be looking for work. Some Americans have simply given up. Just 62.4% of working-age Americans were employed or looking for work in March, down more than a full percentage point from January 2020.
An alternative official measure of unemployment includes these dejected former workers as well as part-time employees who want a full-time job but can’t find one. That figure stands at 6.9%. For Black Americans, the official unemployment rate is 6.3%, with the alternative measure several percentage points higher.
This disparity is partly due to the lingering effects of racism in this country. But they’re also partly the result of disastrous immigration policies that have depressed workers’ — especially Black workers’ — wages.
Black men earn 87 cents on the dollar compared to White men, and Black households have, on average, just 10% of the net worth of White households. According to one study, immigrant waves between 1980 and 2000 may account for up to 60% of the decline in Black wage rates relative to Whites.
To be sure, high levels of immigration hurt workers in all demographic groups. According to Harvard economist and immigration expert George J. Borjas, increasing the number of workers in any given group by 10%, for example through immigration, is likely to result in a 3% reduction in wages. But it’s the less-skilled workforce, which is disproportionately made up of minority workers, that immigration hits hardest.
Driven largely by mass immigration, the total number of less-skilled workers in the United States has ballooned by 25% over the past quarter-century. Unsurprisingly, average pay in this group has decreased by up to $1,500 annually.
And this isn’t a new phenomenon.
During the late 19th and early 20th centuries, Black leaders were some of the most prominent advocates for reducing immigration levels. Leaders like Booker T. Washington and Frederick Douglass understood that welcoming millions of immigrants — then mostly Europeans — only set the wages of less-skilled workers on a race to the bottom.
When the U.S. labor market finally tightened from 1940 to 1980, due in large part to closely controlled immigration levels, Black male incomes grew by 400%, as immigration policy expert Roy Beck points out in his recently released book “Back of the Hiring Line.” That staggering increase outpaced even that of White men, whose incomes rose by 250% over those 40 years. This momentous progress towards economic equity was underway even before the passage of the landmark 1964 Civil Rights Act.
As immigration levels ramped up again in the 1980s and 1990s, however — eventually reaching roughly four times what they were before 1965 — relative Black wages went in the opposite direction. Today, most of the mid-century progress America made against the racial wage gap has been lost.
Both major parties bear responsibility for this reversal. The bipartisan Immigration Act of 1990, which increased the country’s annual immigration cap overnight, was enacted by a Democrat-controlled Congress and signed into law by a Republican president. Even now, members of both parties are pushing to increase the overall level of immigration.
The historical record shows exactly what will happen if they succeed. Reducing the influx of foreign workers, and thus ensuring tight labor markets, is the best way to improve the lives of workers of all races, but especially Black Americans.