Race relations in the United States: education and wealth disparity remain a key impediment

At a time when 61% of American adults in the July 2021 Pew poll view the long-term rise in ethnic diversity as neither good nor bad, with only 22 per cent saying it was bad, how does the US fare in terms of overcoming racial differences given the large minorities within its population?

Despite various critical academic concepts suggesting that racism is entrenched in the US through “an intricate web of laws and norms that maintained disparities of wealth, education, housing, incarceration and access to political power”, and state Republican lawmakers now passing legislation to prevent critical race theory from discussions in classrooms, the evidence does suggest that education and wealth disparity remain important factors preventing greater integration.

This is despite race relations having improved considerably since key legislation was implemented to counter racial discrimination in the 1950s and 1960s, including Brown v. Board of Education (1954), the Civil Rights Act (1964), the Voting Rights Act (1965) and the Fair Housing Act (1968).  

One can observe such evidence prior to the coronavirus disaster when the unemployment rate for Blacks improved to 5.5 per cent by September 2019 compared to 3.2 percent for Whites.    

With census data indicating that the poverty rate was 14.4 per cent for all Americans by 2019, with Blacks improving from 47.6 per cent in 1982 to 26.4 per cent, the median income of $68,703 (US dollars throughout) in 2019 for all American households included Asians $98,174, white non-Hispanics $76,057, all Whites $72,204, Hispanics of all races $56,113, and Blacks $45,438.

When considering the difference between families' gross assets and their liabilities to include home ownership, shares and savings (including superannuation), the federal reserve noted that White families had a median and mean level of wealth of $188,200 and $983,400, Black families $24,100 and $142,500, and Hispanic families $36,100 and $165,500.  

Having less income and wealth is a huge impediment to progress, as illustrated by education outcomes.  

While many families will seek to live in the best neighbourhoods they can afford, it is argued that the quality of primary and secondary schools in the US is highly correlated with the wealth of a community given that school funding primarily is dependent on local property taxes that is driven by the wealth of residents.

With majority non-White school districts as a whole receiving $23 billion less than majority White districts, despite serving the same number of students, the end result is that 74 per cent of Black students were in mid-high or high poverty schools in the 2016-17 school year compared to 31 per cent of White students (44 per cent to 8 per cent in high-poverty schools).  

Of the students who do go on to college, with the proportion of Black students completing high school diplomas or the General Educational Development equivalent improving from 66 per cent to 88 per cent between 1990 and 2017 (Whites from 79 per cent to 90 per cent), Blacks face a greater  financial burden with just 41 per cent of Black students graduating by 2018 after beginning their degrees in 2012 compared to 67 per cent of White students.

Blacks and Hispanics have the lowest levels of bachelor degree or higher attainment despite all groups improving in percentage terms from 2010 to 2019: Asians 52.4 to 58.1, non-Hispanic Whites 33.2 to 40.1, Blacks 19.8 to 26.1, and Hispanics 13.9 to 18.8.

Hence, Blacks and Hispanics are more likely to have lower wages in line with the average full-time wage for a worker in 2019 being $27,040 for those with less than a high school diploma, High School Diploma $37,024, some College but No Degree $40,248, associate’s degree $43,472, bachelor’s degree $60,996, Master’s Degree $72,852 and Doctorate or Professional Degree $90,636-$95,472. 

This is especially true today for Blacks and Hispanics living in the larger cities which now have fewer well-paid job opportunities for less skilled workers as many clerical, administrative and sales work with higher wages and union benefits have been lost and replaced by lower paid jobs with fewer benefits such as cleaners, security guards, and health aides, thus offsetting any city advantage that comes from the availability of non-profits and social services, training programs, or better access to health care and public transit.

A 2021 report by the McKinsey Global Institute, noting that the annual median wage of all US  workers is about $42,000, indicated that 43 per cent of Black workers earn less than $30,000 per year, including around one-third of all security guards and school bus drivers with median wages of $26,000 and $26,500 respectively, and over 35 per cent of all nursing assistants with a median wage of $23,000.

Not surprisingly, as wage growth for White and Hispanic workers from 2000 to 2018 increased  faster at every decile of income than for Black workers, it was estimated that 14.3 per cent of Black workers in 2017 earned poverty-level wages less than the federal poverty line for their family size, compared to just 8.6 per cent of White workers.

With less wealth creating opportunities, Blacks remain disadvantaged on a number of other measures when compared to Whites.   

As of 2018, only 55.4 per cent of Blacks had private health insurance, compared with 74.8 percent of Whites, albeit the Affordable Care Act (or “Obamacare”) provided new coverage options for low- and moderate-income individuals that reduced the uninsured rate for Blacks from 19 per cent to 11 per cent from 2013 to 2016 while rates for Whites were cut from 12 per cent to 7 per cent.  

In 2020, only 44 per cent of Black households owned their homes compared with nearly 74 per cent of Whites,after Black homeownership peaked at 49 per cent in 2004 before the collapse of the housing market in 2008 hit Black homeowners hardest.  

Although based on 2014 data, it was reported that Blacks also retire with a lower median income of $16,863 when compared to $23,292 for Whites, although higher than $13,560 for Hispanics, while the proportion of Blacks relying on social security for retirement income was 44.8 per cent compared to 39.2 per cent for Whites and 45.9 per cent for Hispanics.

Blacks continue to have the highest rates of arrests, as seen by recent data which found that Blacks were arrested at a rate five times higher than Whites in 2018 when assessing 800 jurisdictions and accounting for the demographics of the cities and counties those police departments serve.

With regard to the high rate of Blacks and Hispanics being arrested in New York City, experts (including former police) point to “overreaching laws” passed by legislatures that end up being biased against residents of economically disadvantaged communities where there is a higher minority representation; a lack of educational, health and social service resources to solve problems (often domestic) which leaves them with a reliance on 911; and the need of police to respond to state law requiring arrest for harassment, assault, and narcotic possession and/or use.

Despite greater interaction between the races in recent decades, with the 2020 census noting that 33.8 million Americans now identify as multiracial (including 13.5 million non-Hispanic Americans and 20.3 million Hispanic Americans), the average segregation index by 2020 of Blacks and Whites living together was still nearly 60 (0 full integration and 100 complete separation) across 51 metropolitan areas with at least 1 million residents, although vastly more integrated than in 1960 when 199 US cities scored over 70.

Finally, and despite Hispanics continuing to have marriage patterns more similar to Whites, perhaps reflecting the reality of the large Hispanic population consisting of many first or second generation immigrants who come from countries “where the imperative to marry remains strong”, the above factors citing economic disadvantage may help explain a lower marriage rate for Blacks that can  diminish future prospects for family stability and wealth creation.  

Despite higher divorce rates for all races in recent decades, as of 2019 only 30 per cent of Blacks were married compared to 43 per cent of Hispanics, 52 per cent of Whites, and 58 per cent of Asians (48 per cent of all Americans).

As of 2020, at a time when the proportion of American children living with two parents had declined to 70 per cent, less than 40 per cent of Black children were living with two parents.

Nearly half of Black children lived with their mothers alone compared to 20 per cent for Hispanic children, 13 per cent for White non-Hispanic children, and 8 per cent for Asian children.

But Americans remain optimistic about race relations with a May 2021 NPR/PBS NewsHour/Marist poll finding that 57 per cent think race relations for future generations will be better than they are now, albeit 23 per cent say they will be worse, and 15 per cent report they will be about the same.

Is the answer education, in line with Asian Americans having the highest average income and high education levels, despite that category having the greatest disparity in terms of income amongst its many ethnicities?

While further gains overcoming economic disparity will take time, education is indeed important given that the McKinsey Global Institute estimated in 2021 that about 6.7 million Black workers (or 42 per cent of the Black labour force) currently hold jobs that could be subject to disruption by automation and digital tech advancements by 2030.

Despite blacks comprising about 13 per cent of the US population, McKinsey notes that Blacks comprise just 6 per cent of computer science and engineering students, 2 per cent of businesses (more than one employee), 5 per cent of physicians and 4.5 per cent of software developers.

McKinsey recommends that companies eliminate biases in hiring, diversify promotion and offer young Blacks more paid apprenticeships and internships, while corporations could encourage more Black students to enter jobs related to science, technology, engineering and mathematics curriculum in schools through sponsorship programs.

Given the argument that students perform better when their teacher is of the same race/ethnicity, higher education attainment can promote opportunities for more Blacks and Hispanics to teach given that the overwhelming majority of public elementary and secondary school teachers between 2003-04 and 2015-16 were White.

A greater commitment to domestic education and employment may also diminish the need for high levels of immigration with Asian immigrants holding the majority of employer-sponsored H-1B visas in recent times, albeit that the 2018 limit of 85,000 overseas workers in specialty (professional) level occupations with at least a bachelor’s degree represents a fraction of that 2,000,000 college students that today graduate with such a qualification each year.

There are some positive examples of more being done to help Blacks and others get ahead.  

In Stockton, California, where Blacks and Asians have poverty rates were well above the national average, a universal basic income experiment began in February 2019 (funded by donors) which involved giving $500 a month to 125 people for two years to people living at or below the city's median household income.

It was reported in March 2021 that the program had reduced the month-to-month income fluctuations that households face for basic living needs, increased recipients' full-time employment by 12 percentage points, and decreased their measurable feelings of anxiety and depression, compared with their control-group counterparts.

While it was noted that more research was needed as people are unlikely to drop out of the labour force if they know the extra money is temporary and that the program may endanger certain existing safety net programs, there were now 40 US city mayors advocating for direct, recurring cash payments in cities from Seattle to San Antonio to Pittsburgh.

The Stockton Scholars scholarship program also provides up to $500 a year for two years for students attending two-year colleges or trade schools and $1000 per year for four years for students attending four-year colleges or universities, with 3,200 students benefiting as of November 2021.  

To conclude, it remains to be seen how the US deals with issues relating to race.

One hopes that the Supreme Court will continue to block any attempt to make it difficult for non-White residents to participate in the political process, as it did in 2020 when ruling against the Trump Administration, and that Democratic Party leaders stop simply demanding that Black voters show up at elections yet do little in power to secure the rights of their most loyal constituents.

Looking at the evidence, however, it appears that education is most important to further overcome economic disadvantage between the races, notably Blacks, to build upon the considerable improvements achieved within US race relations during recent decades.