The Black and Hispanic Unemployment Rates Don't Deserve Applause

On Monday morning, President Trump tweeted that the unemployment rate for black Americans had reached the lowest on record, and that the rate for Hispanic Americans will soon reach a similar milestone. He effectively claimed credit for these improvements, writing, “Dems did nothing for you but get your vote!”

The truth is, Trump has so far done little to contribute to the declines in unemployment among blacks and Hispanics—those declines are more a reflection of the sound economic policy of the past decade. And even though the black and Hispanic unemployment rates have improved over the past year, they are still much higher than the rate for white Americans—and that’s a crucial piece of context missing from Trump’s tweet.

For almost as long as unemployment statistics have been recorded (since around the time of the Great Depression), a gulf has existed between white Americans and black and Hispanic Americans. A good yet unfortunate rule of thumb is that the unemployment rate for blacks is generally about twice as high as the one for whites.

The latest jobs report indeed shows that these gaps had closed just a bit. In December 2017, the unemployment rate of the American populace as a whole was 4.1 percent. The racial breakdown, as usual, shows some sharp discrepancies: Only 3.7 percent of white Americans were unemployed at the close of the year. The unemployment rate for Hispanics was more than a percentage point higher, at 4.9 percent. And for black Americans, unemployment was just under twice the rate for white Americans, at 6.8 percent.

It’s true that 6.8 percent is historically a fairly low unemployment rate for black Americans, but it’s not a good or healthy unemployment rate by just about any measure. “If we had an overall unemployment rate of 6.8 percent, nobody would be cheering about that,” says Valerie Wilson, an economist at the left-leaning Economic Policy Institute. The last time the unemployment rate for the nation as a whole was that high was about five years ago, during a period when the economic recovery had yet to take off. And while it’s true that the most recent jobs report shows that the gap has narrowed a little, its existence still points to troubling discrepancies in the labor market that can’t all be explained away by differences in education and skills.

In truth, neither Trump nor Republicans can take much credit for the small amount of improvement that has occurred. According to research from the Federal Reserve, a slight narrowing of this gap, and an improvement in the unemployment rate for blacks and Hispanics, is precisely what is expected after a period of prolonged economic growth. The United States is in the midst of one of the longest stretches of job creation in modern history. And most of that economic growth has been presided over by President Obama, and his appointee for Fed chair, Janet Yellen (whom Trump declined to reappoint).

This is something that economists from across the political spectrum tend to agree about. When I talked to Wilson, she said, “The data and the evidence clearly show that the recovery of employment was well underway before President Trump took office.” And Michael Strain, an economist at the right-leaning American Enterprise Institute, told me last year that continuing existing economic policy could theoretically help groups with historically high rates of joblessness.

Specifically, economists have attributed the dropping unemployment rate to Yellen’s decisions to continue suppressing interest rates—despite objections from the GOP and criticism from Trump during the campaign. It was sober economic policymaking over the course of a decade—not any single thing that’s happened over the past year—that brought the black and Hispanic unemployment rates to where they are now.