Declining public sector jobs, black workers and the racial gap

A recent New York Times article reports on how the long downturn of the US economy has hit the public sector hard, which, in turn, has been devastating for the black middle class. The article notes that black workers are about one third more likely than whites to be employed in the public sector. Blacks have historically been more able to find work in the public sector, as they faced more discrimination in the private sector. Overall, unemployment rates for blacks have consistently been about twice that for whites, with the black unemployment rate peaking at 16.7% last summer.

The article provides important reporting, but it is unfortunate that it only cites economists and does not address sociological contributions to understanding racial discrimination in labor markets. It notes that economists explain the persistent racial gap in terms of lower educational levels for blacks (the standard human capital refrain), along with continuing discrimination.

But sociologists show that the racial gap holds when controlling for levels of education, labor market experience, and other human capital variables – and that economists have no way of accounting for the persistence of racial discrimination, save for the weak notion of a “taste for discrimination” or the idea of statistical discrimination (in which ostensibly non-racist managers make rational decisions based on stereotypes about a group’s “average behavior”).

There is of course a rich sociological literature on racial disparities and discrimination in the labor market — see the review by Devah Pager and Hana Shepherd of Princeton. In addition to individual-level explanations, these authors discuss, among many others, sociologist Charles Tilly’s theory that “durable inequality arises because people who control access to value-producing resources solve pressing organizational problems by means of categorical distinctions.” They also discuss other structural explanations such as the historical development of the public education and criminal justice systems, “contexts in which ostensibly race-neutral policies can structure and reinforce existing social inequalities.”

These sociological explanations penetrate beyond the individualist explanations of economics to examine the institutional contexts into which individuals are born, contexts which shape racial identities. To be fair, economists have contributed important empirical analyses, and some have learned from sociological insights. But purely economic analyses, which focus only on individual characteristics and behaviors, provide limited explanatory insight into this most enduring of labor market phenomena.

Sociological explanations, in contrast, go beyond, and often penetrate beneath, the economists’ rational choice analyses, to demonstrate how existing race-based power relationships generate and reinforce institutional forms of racial discrimination in the labor market. Indeed, the best of sociological explanations show how socially constructed racial categories become embedded in institutions of education, law, government and economy to produce racial identities and practices. Indeed, one wonders whether the assault on the public sector might itself be tinged with an implicit, yet deeply felt reservoir of anti-minority sentiment.

If racial disparities in America grow out of the racialized character of the core institutions of society, then what can be done? While any particular black individual may be able to gain enough education and skill to make it in today’s labor market, “more education” is simply not a feasible policy solution for such a structural crisis. And as the Times article shows, the private sector is part of the problem: much of the upward mobility of blacks into the middle class happened through the public sector. Also, not mentioned in the article, is that unionized manufacturing jobs (most of which have not been lost due to global outsourcing) helped create a black middle class.

The upshot is that any way to address the problem most be organizational or structural, not individual. As Geoff Mason and Wiemer Salverda have shown, a quarter of all jobs produced by employers in the economy are low-wage jobs (see their Chapter 2 in Low-Wage Work in the Wealthy World). In the absence of sustained intervention by unions or the government, the economy will continue to produce low-wage, dead-end jobs, and these will continue to be disproportionately filled by disadvantaged blacks.

To say that there is no easy solution is an understatement — not because we don’t know how to begin fixing the problem (anti-discrimination laws, pro-union laws, living wage floors), but because the politics are framed in terms of the dominant American rhetoric of government vs the “free” market. Until we can transcend that debate, by rejecting neoliberal dogma and free market fundamentalism, then the economics of race will continue to be framed in those terms, and the racial gap will persist, indeed, likely grow.