Exclusive Analyses of Employment and Unemployment Data Show Native Americans Plagued by Extreme Joblessness

Native Americans’ Odds of Being Employed Are 31 Percent Lower Than Those of Whites

In two new Economic Policy Institute briefs, Algernon Austin, EPI Director of the Race, Ethnicity, and the Economy program, analyzes unemployment and employment data for Native Americans and shows that Native Americans had significantly lower odds of being employed than whites. In High Unemployment Means Native Americans Are Still Waiting for the Recovery, Austin presents new unemployment-rate estimates for Native Americans nationally and by region and explains that they have endured five years of unemployment rates over 10 percent.  In Native Americans and Jobs: The Challenge and the Promise, Austin examines Native American employment data not readily available elsewhere and outlines policy recommendations to increase Native American employment.

“Native Americans suffer from crisis-level unemployment rates across the country; Native Americans’ odds of being employed are 31 percent lower than those of whites,” said Austin. “Through providing Native Americans with the same opportunity to work as whites we can begin to surmount these challenges.”

In the first half of 2013, the American Indian unemployment rate was 11.3 percent, and it has been over 10 percent for five years, Austin explains in High Unemployment Means Native Americans Are Still Waiting for the Recovery. Native Americans had the highest unemployment rates in the Midwest (16.8 percent), Northern Plains (15.0 percent), and Southwest (15.0 percent), and the lowest rates were in the Southern Plains (6.8 percent) and the Northeast (8.3 percent).

However, while the unemployment rate is the most commonly used measure of joblessness, it is not the best measure for populations suffering from chronically high unemployment. These communities have a significant number of people who stop looking for work because their odds of finding work are very low. As such, they are no longer counted as unemployed and are defined as not being in the labor force. In Native Americans and Jobs: The Challenge and the Promise, Austin examines the employment-to-population ratio, which provides the share of the population that is working and which is a more accurate measure for populations suffering from chronically high unemployment.

Using data from the 2009-2011 American Community Survey (ACS), Austin compares the employment rates of whites and American Indians in their prime working ages (between 25 and 54 years old), when their employment rates should be highest. The ACS has a sufficient sample size to permit an examination of Native American employment rates by state. Over this period, the American Indian employment rate was 64.7 percent, 13.4 percentage points lower than the white rate.

Of the 34 states examined for Native American employment, the highest American Indian employment rates were in Nebraska (73.4 percent), Connecticut (72.0 percent), and Texas (71.3 percent). The lowest were in South Dakota (54.8 percent), Arizona (56.6 percent), and Utah (57.3 percent).  In all of the states examined, there was a large, very large, or extremely large Native American–white employment rate disparity in 2009–2011. The largest disparities were in the Midwest among the states with some of the highest white employment rates. In addition, even when Native Americans are the same age and sex, have the same education level and marital status, reside in a city in the same state, and are similar to whites on all of the other variables in the analysis, their odds of being employed are 31 percent lower than those of whites.

Austin recommends policy solutions including: empowering Native American communities, improving Native American education outcomes, investing in infrastructure, and conducting additional research on Native Americans’ economic circumstances.