Some of Dr. Martin Luther King Jr.'s dreams have certainly come true. But when it comes to closing the economic gap between black and white Americans, we've got a long way to go.
On this MLK Day nearly 46 years after King's death, persistent discrimination means that black Americans are more likely than their white counterparts to struggle economically. And it's much harder for them to pull themselves out of that financial insecurity. One prominent example of how racism affects black Americans' economic prospects is in the job market, where they're much more likely to be unemployed than white Americans.
Some of that has to do with lower rates of educational attainment and a lack of access to hiring networks. But even when you account for all of those things, “the leftover bit is the out-and-out discrimination,” said Heidi Schierholtz of the Economic Policy Institute, a left-leaning think tank. There are a number of reasons why the playing field is so unequal.
The black jobless rate is twice that of whites.
“What that means is that at a time like this, the black unemployment rate is extraordinarily high,” Schierholtz said. “They’re really hit particularly hard.”
Black Americans face discrimination when looking for a job, which affects their earnings.
The gap between black and white household income has actually widened over the past several decades, according to the Pew Research Center.
They face discrimination in the housing market.
During the housing boom, black Americans were more likely to be targeted by subprime mortgage lenders. Once the boom crashed, they were more likely to lose their homes and have lower credit scores as a result. As this chart from the Bipartisan Policy Center shows, the black homeownership rate was lower in 2010 than in 1990.
.... And are disproportionately burned by the debt-collection industry.
Debt collectors are more likely to hound black customers than white customers, even though both groups report relatively equal levels of repayment rates, according to a recent survey from think tank Demos and the NAACP.
All of this means that black Americans have a much harder time building wealth than their white counterparts.
The Great Recession only made this problem worse, a February study from the Urban Institute found.