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Unemployment among Black men fell in October, but so did the labor force participation rate


A Now Hiring sign at a Dunkin’ restaurant on September 21, 2021 in Hallandale, Florida.

Joe Raedle | beautiful pictures

The unemployment rate for Black men dropped in October while it rose for most other groups, but that could be because workers are dropping out of the workforce.

The October nonfarm payrolls printout shows US economy added 261,000 jobs in the month and the unemployment rate for all workers increased from 3.5% to 3.7%.

For Black men, the unemployment rate fell to 5.3% from 5.8% a month earlier on a seasonally adjusted basis. The white unemployment rate rose to 3.2% from 3.1% a month earlier.

“It went in the right direction for the wrong reasons,” said Bill Spriggs, a professor of economics at Howard University and chief economist at the AFL-CIO.

Wrong reasons

The drop in the unemployment rate for Black men can be attributed to the labor force participation rate, which fell slightly to 67.2% in October, down from 68% the previous month.

Additionally, the employment-to-population ratio of Black men has fallen to 63.6% from 64.1% in September, which may indicate that workers have stopped looking for work, causing lower unemployment rate.

The unemployment rate for Hispanic workers also spiked in October, outstripping gains for black and white workers. It rose to 4.2% from 3.8% in September.

“It shows the continued frustration that people of color are experiencing in the labor market,” Spriggs said. While the labor market is strong overall, “it’s not a tight labor market where anyone can step in and get a job no matter who they are.”

Overall, the black unemployment rate increased led by Black women. In October, the unemployment rate for black women increased from 5.4% in September to 5.8%.

“This is worrisome because throughout the pandemic and the global recession,” said Kate Bahn, director of economic policy and chief economist at Washington’s Center for Equal Growth, a nonprofit organization. economic recovery from the pandemic crisis, black women have fallen behind”

On the brighter side, the employment-to-population ratio of Black women was unchanged, although labor market participation did increase during the month. According to Valerie Wilson, program director of race, ethnicity and economics at the Economic Policy Institute, it could be a sign that more and more black women are returning to the workforce and are finding job but still can’t find a job.

“It doesn’t show that there are a large number of people losing their jobs,” she said.

Go forward

Of course, one month’s data doesn’t make a trend, so it’s important to look at the long-term picture for people of color.

Overall, the unemployment rate for workers of color has fallen in recent months in proportion to the proportions of whites, and labor force participation and employment-to-population ratios, Mr. Wilson said. numbers are mostly kept stable.

However, there could be reason for future concern depending on how the Federal Reserve reads its October report. The labor market remains strong amid historic interest rate hikes aimed at curbing inflation is high, and the central bank is poised to continue down the path of rate hikes.

If the Fed goes too far and pushes the US economy into a recession, that could have the worst impact on workers of color.

“If we were to push the economy into a recession, that impact, at least historically, is more likely to hit communities of color harder,” Wilson said.

– CNBC’s Gabriel Cortes contributed reporting.

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