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Program on Economic Inclusion

Labor Market Outcomes

Chart data last updated: July 6, 2021

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Examining published labor market performance measures by race is one way to monitor economic inclusion. While we recognize that there are many dimensions to this important issue, these regularly updated data series allow for a timely national perspective on economic inclusion and racial equity. The Bureau of Labor Statistics data we report on this page treat race and Hispanic origin as two separate and distinct concepts. People who are Hispanic may be of any race. People in each race group may be either Hispanic or not Hispanic. The statistical implications of this are further discussed at the Bureau of the Census.

Employment rate

The most fundamental indicator of a group’s involvement in the economy is the employment rate, otherwise known as the employment-to-population ratio, which reports the fraction of a group that is employed at any given time. Historically, there are marked differences in the employment rate by race, with the greatest differences between Black and white populations. These differences reflect longer-term variances in opportunities; however, they also reflect the greater sensitivity of minority employment to recessions. That is, minority employment tends to be affected more deeply by recessions than does white employment. Racial disparities in the employment rate tend to grow during recessions and shrink during expansions. Initial pandemic-related decreases in employment were broad-based, and no racial group has seen a full recovery to prepandemic levels in its employment rate. Hispanic populations continue to show larger employment rate impacts from the pandemic, while Asian populations are closest to prepandemic levels.

Labor force participation rate

An individual is participating in the labor market if they are either working or actively looking for work. Individuals considered not participating in the labor market may be, for example, students, family caretakers, retired, or unable to work because of a disability. Differences in the participation rate by race tend to be smaller than differences in the employment rate by race and usually show little change in pattern during recessions. However, the pattern has shifted during the pandemic. Initial pandemic-related declines in participation were broad-based across races, but reductions in the labor force participation rate remain largest for Hispanic populations compared to their prepandemic levels. Asian labor force participation rates have recovered to above their February 2020 level.

Unemployment rate

The unemployment rate refers to those without a job who are actively looking for work or are waiting to be recalled from a temporary layoff. The rate highlights the effects of recessions and recoveries on workers. Historically, Black unemployment has been significantly higher than white unemployment. Furthermore, racial discrepancies in unemployment tend to grow during recessions and shrink during recoveries. Initial pandemic-related increases in unemployment were broad-based; however, Asian, Black, and Hispanic unemployment rates remain relatively elevated when compared to their prepandemic levels.

For a more in-depth discussion of evolving labor market outcomes by race see Racial Gaps in Labor Market Outcomes in the Last Four Decades and over the Business Cycle.