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Recession Expanded Racial Economic Gap

By George Curry, NPPA News Analysis

The notion that when whites catch a cold, Blacks get pneumonia has been validated in two recent studies that show the economic gap between Whites and people of color has grown during the economic downturn.

That’s the conclusion reached by a Center for American Progress report titled, “The State of Communities of Color in the U.S. Economy” and by a State of the Dream report by United for a Fair Economy titled, “Austerity for Whom?”

“The Great Recession of 2007-2009 produced widespread employment losses for communities of color and white families alike — losses that have yet to be overcome amid the still tentative economic recovery,” the Center for American Progress study observed. “All U.S. households were severely hurt by the recession but communities of color experienced larger losses than whites. This also means that as the economic recovery deepens and the labor market recovers, communities of color will have to climb out of a deeper hole to regain the same level of economic security as they had before the crisis.”

But there were significant variations even among people of color.

“Americans saw few economic gains during the last business cycle, with stagnant or declining homeownership and wages, high unemployment rates, and low employment rates even as the economy grew,” the Center for American Progress reported. “Latinos, in comparison, saw comparatively strong job gains that were reflected in other gains, particularly in homeownership, during the last business cycle. Those gains, though, were insufficient to provide a buffer for Latinos once the recession hit, leading Latinos to lose most of the ground gained during the previous business cycle [March 2001 to December 2007].”

Although the data showed Asian-American employment and income were on par with those of whites, that observation could be misleading, because it relies heavily on figures for Chinese and descendants from India. Very little data were compiled on Vietnamese Americans or Cambodian Americans, two groups likely to be less affluent than Chinese and Indians.

According to data compiled by the Center for American Progress:

• The unemployment rate for African Americans was 15.8 percent in the fourth quarter of 2010, compared to 12.9 percent for Latinos, 7.3 percent for Asian Americans and 8.7 percent for whites.

• Homeownership rates for Blacks in the third quarter of last year were 45 percent, compared to 47 percent for Latinos and 74.7 percent for whites.

• Racial and ethnic differences have stayed the same or worsened during the recession and recovery. Unemployment rates rose faster for African Americans and Latinos than for whites, while homeownership rates fell faster. “Trends for poverty rates, health insurance coverage, and retirement savings also show widening gaps by race and ethnicity throughout the recession and recovery after 2007.”

United for a Fair Economy is a Boston-based nonprofit organization that focuses on economic equality. It issues a “State of the Dream” report each year on Dr. Martin Luther King Jr.’s birthday.

“Four decades after the Civil Rights movement, Blacks still earn only 57 cents and Latinos earn 59 cents for each dollar of white median family income,” this year’s report noted. “The contrast is even starker for net wealth; that is, the total value of investments, savings, homes and other property minus any debt. Blacks hold only 10 cents of net wealth and Latinos hold 12 cents for every dollar that whites hold.”

As President Obama and Congress continue to address the nation’s economic woes, they should understand how seemingly neutral changes in Social Security and reducing the number of government employees will have a disproportionate impact on African Americans.

For example, 59.1 percent of elderly African Americans and 64.8 percent of elderly Latinos depend on Social Security for more than 80 percent of their family income. Among whites, the figure is 46 percent. Without Social Security, 53 percent of elderly Blacks and 49 percent of older Latinos would live in poverty.

Largely because of limited job opportunities in the private sector over the years, Blacks have turned to government employment to advance their careers. According to the State of the Dream study, Blacks are 70 percent more likely to work for the federal government than whites and 30 percent more likely to work in such public sector jobs as teachers, social workers, bus drivers and public health inspectors.

This is particularly true for Black males. Black males earn 57 cents to each dollar of white male earnings, the report states. In the public administration sector, however, Black males earn 80 cents to each dollar of white male earnings.

Whether working in the private or public sector, African Americans are beginning to see an erosion of past economic gains.

In 1947, Blacks earned 51 cents to each dollar of white family median income. By 1977, African Americans were earning 56 cents to each white dollar, a gain of 5 cents.

“Then, as the backlash took hold, progress slowed – and stopped,” the State of the Dream report noted. “By 2007, Blacks earned slightly over 57 cents (57.4 cents) to each white dollar, a gain of just one penny in 30 years. Two years later, as the Great Recession set in, Blacks lost a half-cent, ending at 57 cents to each white dollar of median family income.”

As Republicans and Democrats continue to spar over budget cuts, the State of the Dream report proposes more race-sensitive policies.

It says: “We must honor the legacy of Dr. King by enacting policies that can help to narrow the racial economic divide and bring the opportunity for prosperity to all Americans.”

George E. Curry, former editor-in-chief of Emerge magazine and the NNPA News Service, is a keynote speaker, moderator and media coach. He can be reached through his website, www.georgecurry.com. You can also follow him at www.twitter.com/currygeorge.

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Rebirth Through Finding a New Job

Commentary, Alex Gutierrez
While sitting in the café lobby of a brand new tech building in North San Jose, I signed my name on the last piece of paper of an employee packet for my new job as a dishwasher at a national catering company. It felt good to be able to shake the bosses hand after I filled out the forms, or even have a boss to shake hands once again. I feel reborn.

Since March of 2009 I have been lead on a wild goose chase for the perfect full-time job. I have traveled across the state, even went outside of the state pursuing odd jobs of varying tasks — I’ve worked in event set-up, was a security guard, and even a traveling soap salesman. After a year, I was still lost and confused, and ultimately frustrated with the economy, employers and myself.

It wasn’t easy getting this job. I had been staying on the streets, had to get cleaned up at a public restroom downtown, and had to travel three hours using my last five dollars, just hoping to land it. But I got it.

After leaving the building of my future livelihood, on the light-rail back to San Jose from Milpitas, I couldn’t help but to look back and take a glance in disbelief. I finally got another opportunity to have full-time employment, and even have medical and dental benefits, something very few people my age (at 23-years-old) have through their work. Having a job means I can really live again. When I say live, I mean actually live a decent life of renting my own pad again, buy some new clothes, pay for a decent meal, and finally being able to enjoy things without having to be dependent or having to wait on someone to help me with a handout.

What the high unemployment statistics don’t show, is the direct hit mentally, even nervous breakdowns, that not having a job can have on a person. Unemployment can steal all of the faith you had, right from inside of you.

After a few days into the new job I also made a new friend at work. We got along, and he was nice enough too even let me stay at his house with his family. While staying there, I noticed a jump in lifestyles. What I have thought of privileges for the past few years, is pretty much normal day to day life for others. I was so used to sleeping on the street, that even in the apartment I slept with all my clothes and shoes on. It took a while to know that I can actually fully sleep, and not have to worry if anyone was trying to harm me or take any of my belongings, that I could really just rest. Unemployment becomes psychological because it forces you to create a completely different lifestyle of what you once had, and you can get used to that lifestyle.

I noticed what I had gotten used to as someone without income when I got my first check. We went shopping and I felt I had splurged a little bit on myself – buying some new clothes. It had been so long, I didn’t know any of my sizes, and was scared to put them on, because I didn’t want to get them dirty. I was terrified of putting it on because I wasn’t sure of how long it would be until I would receive some new clothes. It was a habit from the streets, so it took a while for it to sink in that I was working full-time, making decent money and I could buy some more clothes and afford to wash them.

I’ve been working at my new job for a few months now and am getting used to the stable living. The work may be tedious manual labor, but every two weeks I look at my paycheck and smile. After a hard day’s work I get to go home to take a shower, watch tv, or just chill.

With this new job, I feel as though this is the start of a new foundation for my life with a grand opening. It’s like watching a building being built. My foundation has been built on an empty lot with bad piping and bad soil, with sewer water running everywhere. But with every new layer of foundation laid-down comes a purification from the new piping and new soil.

My first level of my construction has already started with my housing situation becoming stabilized and starting a bank account. Even though I have only 25 bones in my checking account, it sure feels good to have 25 bucks than nothing at all.

I still have friends that are still lost in the mix of unemployment, doubting their own capabilities of getting back into the workforce, school, or society for that matter. The feeling of rejection can haunt anyone, and scare them away from an opportunity that could be theirs if they reach out for it. Those feelings really just interfere with the greatness that we all know deep down inside that we can accomplish.

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Seniors Hit Hard By Economic Insecurity

LA Beez, News Report, Mike Santos

Jan is a stately, elderly woman of 65 who had it good not too long ago. She had a lucrative income, some of which she invested in a lovely two bedroom home in a good neighborhood. She did everything by the book to ensure her retirement.

Jan now lives in a group home, sharing a room with eight other women. She subsists on a measly $100 per month—all that’s left for her after Social Security and Medicare are put towards the costs of her housing and care. She says that’s far from enough to cover her daily subsistence and medical needs that are not covered by Medicare.

But that’s all Jan has these days because the preparations she made over the course of decades have been wiped out in the country’s worst economic downturn since the Great Depression of the 1930s.

“I would like to know what you are doing about it,” Jan says angrily at a recent forum hosted by the Greenlining Institute, a non-profit national policy, organizing, and leadership institute working for racial and economic justice. The conference aimed to address the growing economic crisis facing the elderly folks such as Jan.

“I did everything right,” Jan told the attendees at the forum. “I prepared for my future and this is where I ended up.”

Jan is not alone in her dilemma.

In a Health Policy Research Brief prepared by INSIGHT Center for Community Development—a national research, consulting, and legal organization dedicated to building economic health in vulnerable communities—there are nearly half a million elders in California alone who cannot make ends meet.

More than one-fourth of Californians aged 65 and older live alone, and half of them had incomes below the Elder Index, which measures how much income is needed for a retired, elderly adult to meet their basic needs, including housing, food, out-of-pocket medical expenses, transportation and other necessary spending.

In Los Angeles County, the Elder Index is pegged at $23,000 per year, and more than 312,000 elders are trying to survive below that income level.

The California Elder Economic Security Standard Index (Elder Index) is a new tool that quantifies how much income is needed for a senior with a given living arrangement and geographic location to adequately meet his or her basic needs living in the community. It is the only elder-specific financial measure of its kind, and based on credible, publicly available sources for all 58 California counties. It was calculated using actual cost data (housing, food, health care, transportation, and other basic expenses) for older adults living alone and for couples.

“Economic insecurity for the elderly is caused mostly by the high cost of basic necessities and inadequate income prompting them to make untenable choices detrimental to them,” said Dr. Brad Bagasao, who serves as program development director for the Filipino-American Service Group, Inc. (FASGI), non-profit organization that is located in the Historic Filipinotown district of Los Angeles and focused on promoting the physical health and mental wellbeing of underserved low-income seniors.

Elders of all ethnicities are struggling to meet the high costs of living in Los Angeles, but elders of color—who typically earn less than white people throughout their working lives and who often don’t have pensions and 401Ks to supplement their Social Security income—have been hit particularly hard.

“It doesn’t help that California’s financial deficit is forcing Sacramento to cut off essential programs for the elderly,” said Laura Trejo, general manager of the Los Angeles City Department of Aging, an agency that’s expected to see budget cuts.

Elders also face the risks of financial abuse, an increasing trend, with seniors being lured into investments or agreements that are unsuitable or outright frauds, according to Assemblymember Mike Eng.

Eng, a Democrat who represents the 49th District, told the crowd at the forum about his own experience regarding the economic vulnerability of the elderly, combining a cautionary tale with a call for steps to increase the ability of seniors to spot a scam.

“My mother was somehow approached by someone who convinced her, due to her financial insecurity, to sign a power of attorney which basically put all her financial assets in the power of one person who apparently refuses to disclose what the plans will be and where the assets are,” Eng said. “It is this lack of economic literacy which many people are preying on.”

Miko Santos is an editor at Asian Journal.
AJPress photo by Miko Santos.

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Report: Job Loss May Level Off

MILWAUKEE — U.S. employers plan to keep their staffing levels relatively stable during the third quarter of 2009, according to a national report.

Of the more than 28,000 employerssurveyed about their hiring plans for the third quarter of 2009, 15 percent anticipate an increase in their staff levels, while 13 percent expect a decrease in their payrolls. Sixty-seven percent of employers surveyed expect no change in their July – September hiring plans, and 5 percent of employers indicated they were undecided about their hiring intentions, the according to the quarterly report conducted  by Manpower Inc.

“While the numbers may not be as optimistic as we would like, it is positive to see no further deterioration, “said Jeffrey A. Joerres, chairman and CEO of Manpower Inc.

According to Jonas Prising, president of the Americas for Manpower Inc., the data shows continued hesitancy among employers who are watching with “guarded optimism, hoping a few quarters of stability will be the precursor to the recovery.”

The national survey data shows employers in seven of the 13 sectors surveyed expect hiring to remain relatively stable in the next quarter as compared to the previous quarter.

Employers in Construction and Wholesale & Retail Trade anticipate moderate increases, while Non-Durable Goods Manufacturing and Leisure & Hospitality employers expect a slight increase in hiring activity compared to the second quarter.

Employers in two sectors surveyed, Education & Health Services and Government, anticipate a slight decrease in hiring compared to three months ago. Employers in Durable Goods Manufacturing; Transportation & Utilities; Information; Financial Activities; Professional & Business Services; and Other Services sector employers will keep hiring levels relatively stable for the third quarter.

The West has a weaker Outlook compared to the previous quarter, while all regions have a weaker Outlook compared to one year ago at this time. Employer optimism about hiring is relatively stable in the South, Northeast and Midwest.

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Report: Recession Hits Blacks, Latinos, Immigrants Harder

WASHINGTON, D.C. — The current recession is having an especially severe impact on employment prospects for immigrant Hispanics, according to an analysis of the latest Census Bureau data by the Pew Hispanic Center, a project of the Pew Research Center.

The unemployment rate has increased more and the share of the working-age population that is employed has fallen more for immigrant Hispanics than for other racial and ethnic groups in the first year of the recession. Trends in other indicators during the one-year old recession, such as the change in labor force participation or the growth in the number of unemployed persons, also reveal a more severe impact on foreign-born Latinos.

Native-born Hispanics and blacks in the labor market have also felt strong negative effects from the recession. However, changes in the employment rate and other indicators of labor market activity during the recession have been less severe for them than for foreign-born Hispanics.

The report is based on an analysis of the latest data from the Bureau of Labor Statistics and Census Bureau.

Estimates are presented for the fourth quarters of 2007 and 2008 encompassing the first year of the ongoing recession.

The report, Unemployment Rises Sharply Among Latino Immigrants in 2008, authored by Rakesh Kochhar, Associate Director for Research, is available at the Pew Hispanic Center’s website, www.pewhispanic.org.

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