Black Americans face gaps in representation, wages, education, business ownership, and more. This comprehensive report looks at multiple economic realities Black Americans face and the opportunities in closing these racial gaps.
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research has documented geographic mismatches between Black workers and opportunity; underrepresentation in fast-growing, higher-wage industries; lower odds for advancement and higher attrition for Black workers in frontline and entry-level jobs; low representation in executive roles; and a lack of sponsorship and allyship for Black employees. The occupational lens taken in this work is an important complement to those perspectives—and it is inextricably linked to the wage gap, which holds the key to greater economic mobility if addressed.
Today the median annual wage for Black workers is approximately 30 percent, or $10,000, lower than that of white workers—a figure with enormous implications for household economic security, consumption, and the ability to build wealth. Black workers make up 12.9 percent of the US labor force today but earn only 9.6 percent of total US wages.
We estimate a $220 billion annual disparity between Black wages today and what they would be in a scenario of full parity, with Black representation matching the Black share of the population across occupations and the elimination of racial pay gaps within occupational categories. Achieving this scenario would boost total Black wages by 30 percent and draw approximately one million additional Black workers into employment.
The racial wage disparity is a surprisingly concentrated phenomenon. Less than 4 percent of all occupational categories account for more than 60 percent of it (Exhibit 1). They fall into five broad categories: managers of frontline workers, other managers and executives, professions requiring postgraduate training (such as lawyers and physicians), professions requiring undergraduate degrees and accreditation (such as teachers and accountants), and technology specialists (such as software developers and computer and information systems managers). Furthermore, almost 85 percent of the wage disparity is concentrated in just five sectors (professional services, manufacturing, construction, trade/transportation/utilities, and financial services).