Ask Memphis residents and they might say that President Donald Trump got this one right: this is the best job market as far as many in this majority black city can remember.
For single mother Latasha Harwell, it has meant finally landing a full time job as a medical assistant, one with the regular 9 to 5 hours she needs so she can care for her kids. Chiquita Clayton says she has an open offer to move from part-time to full-time work at a FedEx<FDX.N> warehouse; forklift driver Kendrick Jefferson got $3 dollar an hour more for switching employers.
Unemployment in Memphis hit a post-crisis low of 3.5 percent in April. It has since crept back above 4 percent, though partly because of more people joining the labour force.
But with poverty rates here still among the highest in the country, workers, employment advocates, and government officials also say that is only half the story. For this good spell to truly matter to black Americans, they say, it will need to continue for years to come.
Trump often highlights that overall US unemployment has reached a 50-year low on his watch, and that joblessness among black Americans has set a modern record as well.
The unemployment rate for blacks sunk to 5.9 percent in May, the lowest since 1972 when the figure was first reported separately, but the milestone reflects a trend that took shape years before Trump took office.
Black employment has risen about 1.3 million under Trump to hit a record 19.3 million in October, but job gains were the strongest during Barack Obama’s second term when recovery from the Great Recession became more firmly rooted. Recent data indicate job gains for blacks may already be levelling off.
In Memphis, state officials, job recruiters and executives credit a confluence of forces, including a continued boom in logistics, warehousing, and related jobs, for creating what one employment agency executive deemed a ‘gold rush’ moment.
Yet what matters for them is not who gets credit for today’s strong labour market, but whether it will be durable enough to help workers weather the next downturn, something past upswings failed to accomplish.
National data analysed by Reuters shows minority hiring has remained clustered in industries such as food service, retail, and logistics that tend to pay less and have been quicker to lay off staff when the economy slows.
The fear is that will repeat itself, and that after outsized gains during the upswing, relatively more black workers will lose their jobs when leaner times arrive. That is what happened during the last recession, when white unemployment peaked at just over 9 percent while black unemployment shot above 16 percent.
As a result, past recoveries have done little to narrow the gap between black and white incomes, as numerous studies, including recent work by the Atlanta Federal Reserve, have documented.
Nationally, median incomes for black families remain a third below white household incomes. In Memphis the gap is even larger, with a $31,000 median annual income for blacks representing just 54 percent of that of white families.
Last In, First Out
“It is a good thing that African American unemployment is at a very low level,” Fed chair Jerome Powell said at a meeting with community groups in Houston this month. “(But) if you look at what happens in a downturn you see the last people hired are the first to get fired,” he said.
For that to change, workers such as Harwell need enough time to pay off student loans, get a raise or two, start saving for a home, and gain the additional skills and seniority needed to keep working through the next recession.
“This isn’t a job anymore, it is a career…Personally, I say I need two years,” to feel economically stable, Harwell said.
With the US recovery pushing a decade and some signs of a growth slowdown ahead, local social service agencies and state officials say the time for “recession-proofing” is now.
“We know it is not going to last forever,” said Deniece Thomas, an assistant commissioner at the Tennessee Department of Labor and Workforce Development. “There is a sense of urgency,” for workers to assess what skills their employers will need even if business slows, she said.
To help them, the state has made community college free for high school graduates and adults who have not previously earned a degree, one of the most expansive efforts in the country to encourage non-college educated adults to improve their skills. Other programs provide certifications for specific jobs in industries, such as the booming medical device field, that are struggling with labour shortages.
A look behind the headline numbers shows there is still ground to cover.
The black unemployment rate far outstrips the national average, now at 3.7 percent, and since reaching that record low in May has crept up to 6 percent and above even as white unemployment keeps edging lower. Other gauges, such as the employment to population ratio, also lag.
Reuters analysis of the federal Quarterly Workforce Indicators shows that out of five US industry groups where the share of jobs held by blacks grew the most between 2010 and 2017, three were among those that paid the least. Three of those five were also among the industries that shed the most jobs during the last recession. The QWI tracks 19 industry groups.
Published in Daily Times, November 27th 2018.