Race, Ethnicity, And The American Labor Market: What’s At .

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S Y D N E Y S . S P I VA C K P R O G R A M I N A P P L I E D S O C I A L R E S E A R C H A N D S O C I A L P O L I C YRace, Ethnicity, and theAmerican Labor Market:What’s at Work?A S A S E R I E S O N H O W R A C E A N D E T H N I C I T Y M AT T E RJune 2005S E R I E S B AC KG R O U N DThis on-line publication by the American SociologicalAssociation (ASA) is one in a five-part series on theinstitutional aspects of race, racism, and race relations,a project intended to help commemorate the ASAcentennial (1905-2005) and designed for a general readership. As a professional membership association, theASA seeks to promote the contributions and uses ofsociology to the public. These synthetic summariesprovide an overview of the research evidence on howrace remains an important social factor in understandingdisparities in the well being of Americans in manyimportant areas of life (including employment, health,income and wealth, housing and neighborhoods, andcriminal justice) although demonstrable changes haveoccurred in American society over the last century.Published under the auspices of ASA’s Sydney S.Spivack Program in Applied Social Research and SocialPolicy, these syntheses are based upon a vast literatureof published research by sociologists and other scholars.This body of research was reviewed and assessed at aworking conference of 45 social scientists thatattempted to create an integrated map of social scienceknowledge in these areas. The effort was organized byFelice J. Levine, former ASA Executive Officer, RobertaSpalter-Roth, Director of the ASA Research andDevelopment Department, and Patricia E. White,Sociology Program Officer at the National ScienceFoundation (when on detail to ASA), and supported bygenerous grants from the Ford Foundation and the W.G.Kellogg Foundation.In conjunction with the Clinton administration’sPresidential Initiative on Race: One America, the ASA wasencouraged by the White House Office of ScienceTechnology Policy to undertake this ambitious examination of relevant arenas of research, explicate what thesocial sciences know, dispel myths and misconceptionsabout race, and identify gaps in our knowledge. Thepurpose of the President’s overall initiative, begun inlate 1997, was to “help educate the nation about thefacts surrounding the issue of race” and included manyactivities such as university, community, and nationaldialogues; government initiatives and conferences; andtopical reports.The ASA’s original materials have been updated,synthesized, and developed for this Centennial Seriesunder the direction of Roberta Spalter-Roth. The first ofthe series is on race and the labor market and is coauthored by Roberta Spalter-Roth and Terri AnnLowenthal, Legislative and Policy Consultant.The labor market is a set of arrangementsthrough which workers learn about jobs and employerslearn about workers. In principle, the labor market issupposed to be “race blind” in the long run (3). But keyindicators and an examination of factors that influenceworkplace decisions suggest that race and ethnicity playsignificant roles in determining job placement and careeropportunities. Whether a person is looking for a job,seeking a promotion, or considering a new line of work,race and ethnicity constrain individual choices and affectchances of success. Sociologists have explored the rolesthat race and ethnicity play and how race and ethnicityinteract with other factors such as type of job or industry,social networks, and social policies in shaping labor marketoutcomes. In this research synthesis, we first examineindicators of different outcomes and then examine whatexplains these differences. We highlight key findings onhow education and skills, workplace processes, andgovernment policies contribute to or ameliorate work forcedisparities between race and ethnic groups.

RACE, ETHNICITY, AND THE AMERICAN LABOR MARKET: WHAT’S AT WORK?Key Workforce IndicatorsSeveral key economic indicators suggest that noteveryone who wants to work can find a satisfactoryjob (Table 1).White men have the highest laborforce participation and employment rates, and thelowest unemployment rates, of all measured demographic groups; data for Asian men differ onlyslightly.1 A somewhat smaller share of AfricanAmerican men is in the workforce, nearly one-halfof whom do not have jobs. The proportion ofHispanic men in the labor force is closer to that ofwhite men than African American men, althougha smaller share (compared to white men) isemployed.Slightly less than three-fifths of white women areboth in the labor force and employed; their unemployment rate is the lowest of all measured groups.A higher proportion of African American womenare in the labor force, but the gap is greaterbetween their participation and employment rates,and they are more than twice as likely as whitewomen to be unemployed. The share of Hispanicwomen in the labor force is lower than, and theiremployment rate is substantially below, that ofwhite and African American women, althoughtheir unemployment rate is lower than that ofAfrican American women.TABLE 1. Labor Force Participation, Employment, and Unemployment Rates, by Race and Sex, 2000.EMPLOYMENT STATUS FOR POPULATIONAGED 16 AND OVER (percentage)RACE OR ETHNICITY1IN LABOR, African AmericanMaleFemaleAsianMaleFemaleNative Hawaiian,Other Pacific IslanderMaleFemaleAmerican Indian,Alaska NativeMaleFemaleTwo or more 1.469.453.055.262.847. U.S. Census Bureau, 2000. “Profile of Selected Economic Characteristics.” Census 2000, Summary File 4, DP-3.1. Data reflect only those who selected a single race category (e.g., white). In the 2000 U.S. Census, 2.1 percent of the population selected two or more races.2. Hispanics may be of any race.2

A S A S E R I E S O N H O W R A C E A N D E T H N I C I T Y M AT T E RThese economic statistics indicate that, in a robusteconomy, the supply of white and Asian workersmay not meet employer demand, but the supply ofAfrican Americans and Hispanics who want towork outstrips the demand for these workers. Forexample, one analysis shows that the ratio of jobapplicants to job hires is significantly higher forAfrican Americans than for whites in Detroit (26).The result is lower unemployment for whites andAsians and higher unemployment for AfricanAmericans and Hispanics. The roughly two-to-oneratio in unemployment rates between AfricanAmericans and whites (for both men and women)has been constant throughout economic expansions and recessions, despite a shrinking gap ineducational differences between the two groups.Unemployment gaps between whites and Hispanicshave generally been smaller, although the differential between whites and Hispanics nearly rivals thedisparity between whites and African Americans.Hispanics and African Americans also are morelikely than whites to be unemployed for longerperiods of time. Research has shown that AfricanAmerican men, especially those with limitededucation, suffer higher rates of long-term joblessness than white men with similar education (50).Occupational data are another indicator of racialand ethnic labor market disparities (Table 2). Onethird of white men and nearly one-half of Asianmen are employed in managerial, professional, andrelated occupations, compared with one-fifth ofAfrican American men and one-seventh ofHispanic men. Conversely, more than one-quarterof both African American and Hispanic men holdjobs in production, transportation, and materialmoving occupations, compared with less than onefifth of white men and less than one-seventh ofAsian men. A disproportionately high percentageof African American and Hispanic women,compared with white and Asian women, areemployed in service occupations such as foodpreparation, cleaning, and personal care (see also71; 46; 17). These occupations are often in workenvironments characterized by poor pay, few benefits, and little career mobility (63).According to sociological research, occupationalsegregation helps explain persistent wage gapsbetween whites and both African Americans andHispanics, especially for women (11; 66). Thewage gap has narrowed somewhat as AfricanAmericans moved into a wider range of occupations in the 1960s and1970s, boosted by affirmative“According toaction, equal employmentopportunity laws, and higher sociological research,occupational segregaeducation levels, but therelative earnings of African tion helps explainAmericans stagnated in thepersistent wage gaps1980s (34). Researchdemonstrates that wages do between whites andboth Africannot rise for any occupationcharacterized by the presAmericans andence of African AmericanHispanics, especiallywomen (37). Along withfor women ”occupational segregation,work arrangements alsoaffect earnings. For example, African Americanand Hispanic men and women are concentrated innonstandard work positions, such as temporaryand on-call work, that yield lower pay and benefits(43; 44).Queues: The Ranking and Sorting of JobsSociological research documents a wide range ofprocesses through which employers sort and rankworkers, and workers jockey for positions in thelabor market. For employers, the result is a “jobqueue,” a ranking of workers from perceived bestto perceived worst (72). Many labor market economists emphasize the importance of education andskills (referred to as human capital) in explaining1 The labor force participation rate represents the percentage of the adult population that is employed or actively seekingwork. The employment rate is the percentage of the adult population that is employed, while the unemployment rate isthe percentage of the adult population that is not working but is actively seeking work.3

RACE, ETHNICITY, AND THE AMERICAN LABOR MARKET: WHAT’S AT WORK?TABLE 2: Selected Occupational Data by Race, Ethnicity and Sex, 2000.SELECTED OCCUPATIONS FOR EMPLOYED CIVILIAN POPULATIONAGED 16 AND OVER (percentage)RACE OR ETHNICITY1MANAGEMENT,PROFESSIONAL,AND RELATEDSERVICESALES OROFFICECONSTRUCTION,EXTRACTION, ORMAINTENANCEPRODUCTION,TRANSPORTATION,OR 16.527., African tive Hawaiian,Other Pacific 41.49.617.20.916.523.18.9American Indian,Alaska .112.923.71.316.823.59.5Two or more Source: U.S. Census Bureau, 2000. “Profile of Selected Economic Characteristics.” Census 2000, Summary File 4, QT-P28.1. Data reflect only those who selected a single race category (e.g., white). In the 2000 U.S. Census, 2.1 percent of the population selected two or more races.2. Hispanics may be of any race.labor market inequalities. Sociological researchfinds that education and skills play a role but donot fully explain the placement of either group inthe queue or the historical disparities betweenwhites and racial minorities with respect to earnings, labor force participation, training and promotion opportunities, and choice of occupation (14;50; 86). In today’s service-based economy,employers often emphasize a preference for “softskills,”2 creating potential for bias in workplacedecisions (48; 57; 86).Workers also engage in a ranking process, viewingthe desirability of jobs according to pay scales,2 Soft skills include an array of employee characteristics that are subjectively evaluated by employers. They include howindividuals look and dress and their manner of speaking; whether they are perceived to be team players; perceived motivation, cheerfulness, and interpersonal skills; and perceived ability to represent the organization. The studies cited heresuggest that employers perceive African-American men (whether or not they actually interview them) as having limitedsoft skills but rather are perceived as intimidating, hostile and defensive.4

A S A S E R I E S O N H O W R A C E A N D E T H N I C I T Y M AT T E Rfringe benefits, opportunities for advancement,convenient hours, harassment-free environments,and other factors (72; 85; 81). Jobs are less attractive as pay and benefits diminish, but even previously spurned jobs can become desirable whenemployment opportunities are scarce (85).Creation of “ethnic niches” in certain occupationsor industries also affects both the desirability andavailability of jobs. These niches benefit jobseekers from members of racial or ethnic groups byproviding training and shelter from discriminationbut potentially depress wages and constrain careermobility within that niche (36; 75; 85; 86; 91). InNew York City, for example, ethnic niches havehelped funnel workers into specialized servicessuch as fire fighting, police, laundries and drycleaning, taxi companies, gardening, and smallrestaurants (85), creating barriers to employmentin those sectors for workers from other ethnicgroups. African Americans have had limitedsuccess in establishing economic niches in theprivate sector, although more recently they havecreated more successful networks to boost theiremployment chances in many (though not all)public-sector occupations (30; 85).The ranking and sorting process is affected byconstant economic change and restructuring, withthe effect being a movement of current and newworkers up or down the job queue. Theoretically, ifthere were no racial and ethnic discrimination,there would be one queue of workers, with placement in the job queue dependent on skills, education, and experience (16). However, employer preferences also vary by gender and race; preferencesfor whites, and sometimes Asians, alter job queuesbased on educational level and skills. The reality,some scholars say, is several queues with whitesand African Americans often employed in differentindustries, occupations, and types of jobs to theoverall advantage of whites (78). Black andHispanic women face greater obstacles to employment than their white counterparts, as they striveto overcome a lack of available and affordablechildcare, more family illness, and few jobnetworks (39).Reasons for Disparities: Pre-andPost-Civil Rights ActBefore the federal Civil Rights Act of 1964, widespread institutional discrimination denied peopleof color access to many employment opportunitiesand enforced their position at the bottom of thejob queue. Occupational segregation betweenwhites and African Americans–the result of bothlegal segregation and discriminatory practices thatincluded intimidation and violence (38)–declinedmost dramatically in the years immediatelyfollowing passage of the 1964 Civil Rights Act andthen the 1972 Equal Employment OpportunityAct. While the Equal Pay Act of 1963 mitigatedwage disparities between whites and people ofcolor, it did not eliminate them because historicalhiring patterns, educational inequalities, and workplace discrimination continued to affect outcomes(37; 50; 70). In addition, lax federal enforcementof the new civil rights laws slowed dismantling ofsegregated workplaces in the 1980s, despitemarked gains in educational achievement forAfrican Americans (6; 73).In the post–Civil Rights Act era, economicrestructuring had a significant effect on the placement of a group in the job queue. The sharpdecline in manufacturing in the 1970s and 1980shad racially differential consequences for bluecollar workers, precipitating a persistent wage gapbetween more- and less-educated men (88; 89).Many relatively well-paying, unionized manufacturing jobs in the steel, auto, and durable goodsindustries were eliminated, reducing job opportunities and relatively high wages for less-educatedmen (43). White men without post-secondaryeducation suffered the greatest wage losses(because their wages were higher to begin with).But African American men were particularly hardhit by job losses; their unemployment rate hit 20percent during the recession in 1983, again5

RACE, ETHNICITY, AND THE AMERICAN LABOR MARKET: WHAT’S AT WORK?lowering their placement in the job queue.Hispanic men fared somewhat better in the wakeof the industrial downturn, keeping a larger shareof the remaining manufacturing jobs (89). Forexample, as service-oriented industries replacedmanufacturing jobs in Chicago, employmentincreased for Hispanic men with limited educationFIGURE 1:Employment Outcomes of DisplacedWorkers by Race and Ethnicity.White MenWhite WomenLatinoBlack MenBlack WomenLatinaAllPercent Re-Employed (as of February 1996)Source: Roberta Spalter-Roth and Cynthia Deitch, 1999 “‘I Don’tFeel Out-of-Work Sized’: Gender, Ethnicity, and the Unique Costs ofDisplacement.” Work and Occupations 26(4):446-82, Table 2.6or skills, but decreased for African-American men,primarily as a result of employer preferences (80).Corporate downsizing and restructuring continuedeven during the 1990s economic boom. Displacement and job losses among managerial and professional employees, as well as blue-collar workers,were unevenly distributed by race, ethnicity, andgender (32; 49; 70; 77). Figure 1 shows thatwhite men are the most likely group to be reemployed a year after displacement.The industrial slowdown also triggered a periodof relocation among companies seeking moreflexible, cheaper workforces, and cheaper land.There was widespread workforce dislocation,especially for African Americans and Hispanicsin cities in the Midwest and Northeast. In fact,some researchers suggest that fundamentaleconomic restructuring in the latter decades ofthe twentieth century created a spatial mismatchbetween workers and jobs, particularly forAfrican Americans (26; 54; 88). Spatial mismatch matters not only because of the accessibility of jobs, but also because of the accessibilityof social networks that yield job opportunities(14).Other researchers, however, question whetherspatial mismatch alone explains the high unemployment rate for African American men. Forexample, other groups control of job niches suchas police, fire fighting, sanitation, and construction are among the key forces that contribute tojoblessness among African American men (85).Others suggest that African American men arethe special targets of discrimination starting inthe public education system (40). There is somedebate as to whether immigrant employmentoccurs “on the backs of blacks” (51), becauseAfrican Americans and Hispanic immigrantstend to compete in similar occupations and labormarkets (2). Some researchers suggest that immigration does not benefit African American men

A S A S E R I E S O N H O W R A C E A N D E T H N I C I T Y M AT T E Rwith low skill levels and has a downward effect onAfrican American wages, in part because immigrants are likely to have similar skill levels but arewilling to accept lower wages (2; 9). Otherresearchers say that immigration does not result inmassive job losses for African American men,because new jobs are created as a by-product ofimmigration (51).In the 1980s and 1990s, wages for AfricanAmericans and other low-income men stagnatedas the United States experienced its largest surgein immigration since the early 1900s (35). Nativeborn workers in areas with large immigrant populations are most likely to feel the effects of competition, especially for low-skilled jobs, from this newgroup of workers and may migrate away from thesemetropolitan areas and states, further segmentingthe labor market (28; 29). These findings challenge the perception that immigrants, by and large,fill the worst jobs that native-born Americans donot want. Stud

race and ethnicity constrain individual choices and affect chances of success. Sociologists have explored the roles that race and ethnicity play and how race and ethnicity interact with other factors such as type of job or industry, social networks, and social policies in shaping labor market outcomes. In this research synthesis, we first examine

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