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The puzzle of black male unemployment.

Article Excerpt
THE last decade was a good one for low-income women, especially minorities and single mothers. Welfare reform pushed many of them into the labor force, and the strong economy helped others to find jobs. Initiatives to "make work pay," such as child-care subsidies and an expanded Earned Income Tax Credit (EITC), also raised the incentive to work. In all, policies stressing reciprocal obligations as well as incentives and work supports such as child-care assistance dramatically increased employment and reduced welfare dependency for this population.

Low-income men, however, did not fare so well. After declining throughout the 1980s, employment rates of young, less-educated white and Latino men remained flat during the 1990s. Among black men aged 16 through 24, employment rates actually dropped. In fact, this group's employment declined more during the 1990s (when it fell from 59 percent to 52 percent) than during the preceding decade (when it fell from 62 percent to 59 percent). By 2000, young black men worked only about two-thirds as much as comparable white and Latino men.

The downward trend is even more striking when one considers labor-force participation rates, which measure the desire to work rather than actual employment. Many young black men have given up on working in the regular labor market. Employment rates of young black women now exceed those of young black men, even though many of these women must also care for children. This is true even when one excludes incarcerated black men: If these were included in our estimates, the decline in employment in the 1990s would seem even more dramatic.

Why did work activity among young black men fall in the 1990s? Are the contributing factors similar to those of earlier decades, or is something new going on? And can policy makers do anything for this group to improve work incentives and obligations, as they did with considerable success for low-income mothers under welfare reform?

Factors at play

According to a large body of research, several factors contributed to the decline of employment among young black men in the 1970s and 1980s, including declining real wages, the skills gap between whites and minorities, other gaps or "mismatches" between employers and minority applicants, and the growing involvement of minority youth in crime.

Real wages for unskilled young men either declined in the 1970s and 1980s or stagnated, depending on which adjustments are made for inflation. Even under the most favorable assumptions, the wages of these men declined relative to those of women and more-educated workers. Part of the reason was the disappearance of manufacturing jobs, particularly in the industrial Midwest. Other blue-collar jobs also disappeared or offered lower wages. Thus the incentives for young, unskilled men to enter the workforce diminished.

To be sure, not all the news was bad. For instance, both educational attainment and test scores increased more rapidly among young blacks than among whites during this period. But that progress did not generate improved employment outcomes among blacks, since the labor-market costs associated with lower education and skills simultaneously rose...