Racial disparity in Minnesotans’ household incomes begins to narrow

Minnesota is finally seeing some narrowing in one of its stubbornly large racial disparities.

Minnesota’s median black household income has jumped about 43% in inflation-adjusted dollars over the past five years — the most of any racial or ethnic group, according to American Community Survey data released this week. fall. In comparison, it increased by 18% for white households from 2016 to 2021.

That’s a big change from the previous five years, when incomes didn’t budge as much amid a slow recovery from the 2008 recession and when the racial gap actually widened.

“There is definitely progress and we want to recognize that progress,” said Tawanna Black, CEO of the St. Paul Center for Economic Inclusion.

She said the efforts of workforce training organizations and employers had had an impact. Businesses have worked harder to find workers amid the state’s tight pre-pandemic labor market, which has re-emerged as a salient feature of Minnesota’s economy over the past two years.

“It means we’re seeing more employers reaching out to communities that they may not have partnered with in the past,” she said.

The median black household income in Minnesota topped $47,700 in 2021, but a wide gap remains with the median non-Hispanic white household income of around $80,900.

Yet the gap between the two – about $33,000 – has closed by a few thousand dollars over the past five years.

Compared to other states, Minnesota had the 13th largest black and white household income gap last year, according to Cameron Macht, regional labor analyst for the Minnesota Department of Employment and Economic Development (DEED ).

“We got better,” he said. “In 2011 we had the fourth biggest gap… We have a positive trend, but obviously there is still a lot of work to do.”

He added that Minnesota had the eighth fastest increase in median black household income over the past five-year period, moving up 10 spots to have the 22nd highest in the United States.

Minnesota ranks much higher when viewed across its white and overall median incomes, ranking 16th and 14th highest in the United States

Latinos in Minnesota have also seen significant gains over the past five years, with their median household income jumping 40% to about $64,000 in 2021. Asian Americans, who have the highest median household income in the state, at over $92,000. , increased by 13% during this period.

“We’ve entered a period of strong economic growth and strong job growth,” state demographer Susan Brower said of the five years ending in 2021. “I think that’s reflected in the numbers .”

It also matches a period in which the state’s black unemployment rate, which had often been more than three times the white unemployment rate, fell to the lowest levels in years in 2018 and 2019. as the tight state labor market and rising wages drove more black workers. to enter the labor market and find a job.

When the pandemic first hit, black people in Minnesota initially lost their jobs at a higher rate than white workers. But during the recovery, the racial unemployment gap not only narrowed, it reversed. For several months of 2021, black unemployment fell below that of whites for the first time.

While Minnesota’s black unemployment rate rose earlier this year, a troubling trend at a time when Minnesota was also recording the lowest unemployment rates in US history, it has not stopped. to decline in recent months.

Brower added that she’s been tracking continued progress for workers of color in the state in terms of job growth, working full-time rather than part-time, and higher wages.

“We’ve seen this continued improvement in full-time, full-year work with higher wages, which tells me this is a consistent trend rather than just an anomaly,” he said. she declared.

Shauntina Beatty, 44, has experienced it. She had held a number of low-paying “dead end jobs” until she entered a job training program at Twin Cities Rise, a Minneapolis nonprofit, more than a decade ago. .

She first landed a job as an administrative assistant at a small affordable housing nonprofit.

“It was stable,” she said. “I didn’t have to do two jobs like I used to.”

From there, she rose through the ranks into other roles within the organization, such as project coordinator and compliance officer. She’s changed employers a few times since then, mostly taking better-paying jobs in bigger organizations. She is now a property manager for Minneapolis Public Housing, earning about three times as much as when she started.

“Just by being around the colleagues that I was, I repaired my credit and became a landlord,” she said. “A lot of other things I learned along the way just being in the housing market.”

Last year she got her general contractor license and now hopes to start her own business in what she stresses is a very masculine field.

Many people point to the large racial disparities in education in Minnesota as a major factor in the state’s large income disparities. Black from the Center for Economic Inclusion also pointed to other issues, such as the overconcentration of black workers in entry-level health care jobs.

A recent DEED report on the state’s black workforce showed that 40% of black people in Minnesota work in health care and social assistance. The most common occupations for black workers include nursing aides and home care aides, which are low-paying jobs.

“Healthcare is a great field and it’s in high demand in our market and can take a person to a really stable and successful level of income,” Black said. “But we don’t see that happening for African Americans the same way we see it for other races.”

On-the-job training, development and apprenticeships are the kinds of things that can help these workers gain more skills and then move on to higher-paying jobs, she added.

As 2023 approaches, labor experts are concerned about the impact of an economic downturn on people of color, who often see more job losses during downturns.

But for now, the Minnesota labor market continues to buzz, with employers eagerly recruiting new workers. Manny Seyon, 20, of Brooklyn Park is among those who recently landed a new job – and a much better paying one.

Seyon was homeless during his senior year of high school after his family’s apartment was damaged by fire. He went to college for a few years, but the pandemic interrupted his studies. He moved to Minneapolis, working warehouse jobs that paid up to $22 an hour.

A conversation with an Uber driver convinced him to join an app development program at Summit Academy, a career training center north of Minneapolis. He graduated in September. Last week, he started a new full-time position as a software engineering apprentice at US Bank for a salary of $37 an hour.

“It’s amazing to me,” he said. “I’m still trying to make up my mind.”

Leave a Reply