Five years after the beginning of the Great Recession, high unemployment rates are still taking a toll on families. In Michigan, where the overall unemployment rate was 9.0 percent in the fourth quarter of 2012 (compared with a national average of 7.8 percent), African American families continue to bear the brunt of that economic pain.

This research brief supplements a recent report by the Economic Policy Institute’s Algernon Austin, Unemployment Rates Are Projected to Remain High for Whites, Latinos, and African Americans throughout 2013, which documents national trends in unemployment (Austin 2013). Drawing on federal Current Population Survey (CPS) data, this brief focuses on Michigan, highlighting the racial disparities that have prevailed throughout the recession (defined here as including the official recession from December 2007 through June 2009 and the weak and ongoing recovery through the fourth quarter of 2012):

• The unemployment rate of blacks in Michigan is 18.7 percent, about two and a half times that of whites (7.5 percent), and has been for much of the last five years.
• Of the 24 states with large enough African American populations to track with quarterly CPS unemployment data, Michigan has the highest African American unemployment rate.
• In Michigan, three groups—all workers, white workers, and African American workers—have higher unemployment rates than the national rate for the same group.

White unemployment

Michigan’s white workers were hit hard by the recession. For a total of eleven quarters or nearly three straight years (from the first quarter of 2009 through the third quarter of 2011), the white (non-Hispanic) unemployment rate was 9.0 percent or greater. The only state with a longer stretch of white unemployment above this threshold is Nevada, with 17 quarters—over four years (Nevada’s white unemployment rate for the fourth quarter of 2012 was 9.3 percent). As seen in Figure A, Michigan’s white unemployment rate has declined steadily—though slowly—since peaking at 12.8 percent in the third and fourth quarters of 2009. In the fourth quarter of 2012, Michigan’s white unemployment rate of 7.5 percent was ninth highest in the nation.

African American unemployment

African American unemployment rates in Michigan throughout the recession have been devastatingly high, hovering between 18 to 22 percent for most of the last three years, and peaking at 26.9 percent in the third quarter of 2010. Even after apparently turning the corner late in 2010 through mid-2011 with significant declines, the black unemployment rate shot up again in late 2011 before dipping and then increased again in the last two quarters of 2012, reaching 18.7 percent in the fourth quarter of 2012. As shown in Figure B, the black unemployment rate in Michigan was 4.7 percentage points higher than the national black unemployment rate of 14.0 percent. Figure C shows that among states with large enough black populations to measure unemployment, Michigan has the highest black unemployment rate.

Conclusion

Michigan’s recovery from the depths of the Great Recession has been impressive at times, spurred in particular by the successful bailout of the auto sector (New York Times 2012). Yet despite significant reductions in overall unemployment, nearly one in five African American workers continues to be unemployed. Others have stopped looking for work and have fallen out of the labor force altogether, adding to the human cost of an economic collapse and slow economic recovery that has taken a much greater toll on African Americans than whites. The devastating impact on Michigan workers of all races demands strong federal job-creation efforts, as highlighted in From Free-fall to Stagnation: Five Years After the Start of the Great Recession, Extraordinary Policy Measures are Still Needed, but are Not Forthcoming, by EPI’s Josh Bivens, Andrew Fieldhouse, and Heidi Shierholz (February 2013).

Methodology note

Races and ethnicities are presented in mutually exclusive categories, i.e., white refers to non-Hispanic whites and black refers to non-Hispanic blacks. The Bureau of Labor Statistics publishes national annual white, black, and Hispanic unemployment rates; however, its estimates are not based upon mutually exclusive categories and thus will differ slightly from the figures published in this paper.

About the authors

Douglas Hall is the director of the Economic Analysis and Research Network (EARN) at EPI. Hall previously served as director of operations and research for the Connecticut EARN partner, Connecticut Voices for Children, where he played a leading role in work related to family economic security and state tax and budget issues. He is the author or co-author of dozens of reports, and his work has been extensively cited by statewide media. He has a master’s in public policy and administration from McMaster University in Hamilton, Ontario, and a Ph.D. in political studies from Queen’s University in Kingston, Ontario.

Mary Gable joined the Economic Policy Institute in 2006. She coordinates activities of state and local organizations through the Economic Analysis and Research Network (EARN) and analyzes public policies affecting low-income people. She previously directed programs serving people in poverty nationwide and conducted an independent evaluation of New Jersey’s welfare program. Her areas of interest include poverty, social services and welfare policy, child care, and low-wage work. She has a B.A. in political science from the University of Illinois at Urbana-Champaign, and an M.P.A. in social services and welfare policy and in gender and public policy from Columbia University.

Acknowledgements

This issue brief was supported by grants from the W.K. Kellogg Foundation and the Open Society Foundations.

References

Austin, Algernon. 2013. Unemployment Rates Are Projected to Remain High for Whites, Latinos, and African Americans throughout 2013. Economic Policy Institute, Issue Brief #350. http://www.epi.org/publication/unemployment-rates-whites-latinos-african-americans/

Bivens, Josh, Andrew Fieldhouse, and Heidi Shierholz. From Free-fall to Stagnation: Five Years after the Start of the Great Recession, Extraordinary Policy Measures Are Still Needed, but Are Not Forthcoming. Economic Policy Institute, Briefing Paper #355.

Bureau of Labor Statistics (U.S. Department of Labor) Local Area Unemployment Statistics. Various years. “States and Selected Areas: Employment Status of the Civilian Noninstitutional Population, January 1976 to Date, Seasonally Adjusted” [online data table]. http://www.bls.gov/lau/ststdsadata.txt

Current Population Survey basic monthly microdata. Various years. Survey conducted by the Bureau of the Census for the Bureau of Labor Statistics [machine-readable microdata file]. Washington, D.C.: U.S. Census Bureau. http://www.bls.census.gov/ftp/cps_ftp.html#cpsbasic.

New York Times. 2012. “A Million Jobs,” February 25. http://www.nytimes.com/2012/02/26/opinion/sunday/a-million-jobs.html?_r=0