America, We Have A Problem

Marc H. Morial
President and CEO
National Urban League

America, we have a problem.

The July job-creation figures released earlier this month by the federal department of labor have stunned even those the post-9/11 decline in job-holding has made deeply skeptical—which is to say worried—about the short-term prospects for a return to a robust employment labor market for American workers.

They show that, while the national unemployment rate remained essentially unchanged at 5.5 percent during the month, job growth itself virtually stalled: just 32,000 new jobs were created, far below what many economists and others had confidently expected.

That dismal figure provided a kind of exclamation point to the economy's poor record of job-creation during the past several months, when some anticipated a strong surge in new jobs would signal the recovery had reached a new, properly powerful stage.

Since May the economy's added a monthly average of 106,000 jobs—but it needed to add 150,000 a month just to keep up with population growth.

Even more alarming, however, are at least two other statistics which must be considered in any review of the overall jobs picture.

One identifies those jobless workers who've been out of work so long; they've exhausted not only their regular unemployment benefits but also aid under the federal Temporary Extended Unemployment Compensation program. That program, which provided 13 weeks of additional benefits to workers who had used up their eligibility for regular unemployment benefits, was tailor-made for situations like the present—where job-creation is miniscule.

But Congress refused last December to extend the program, and in the months since slightly more than 2 million jobless Americans have been cut off completely from any government unemployment relief.

In March alone, for example, about 354,000 jobless exhausted their benefit status, the highest monthly total ever, according to the Center on Budget Policy and Priorities, which tracks those in this predicament.
The Washington-based progressive think tank projects that hundreds of thousands more jobless will exhaust their benefits this month and next month as well.

The July report from the Bureau of Labor Statistics contained another stunning figure.

Even as the white unemployment rate dipped slightly to 4.8 percent, from 5 percent in June, and the Hispanic unemployment rate rose by a tenth of a percentage point to 6.8 percent, the black unemployment jumped from 10.1 to 10.9 percent, one of its highest levels since the country's economic slump began in March 2001.

That means that since May, while the unemployment rate for whites and Hispanic-Americans shifted only slightly, the rate for African Americans has climbed a full percentage point.

This development is a stark indication of the unequal distribution of economic opportunity—and its opposite, economic pain—that continues to exist in America; and it underscores that this inequality is most evident when comparisons of any sort are made between whites and blacks.

This year's issue of the National Urban League's The State of Black America, illuminated that economic "equality gap"in dramatic fashion.

The first example stemmed from our first-ever National Urban League Equality Index, which we compiled to measure the progress that has to be made before one can declare that black Americans and white Americans live in a society in which race produces no negative accounting.

What we found surprised even us: the economic status of blacks is but 56 percent that of whites.

Secondly, in an incisive essay economist Samuel L. Myers, Jr. pointed out that, while African Americans benefited significantly from the prosperous economic dynamic of the 1990s, they've been so badly hurt by the recession and its aftermath that they "have had greater difficulty taking advantage of the recovery and its associated benefits. … and are still perched precariously between a significant narrowing of income gaps and a persistent inequality in wealth."

One of the foundations of that "persistent inequality"is the high, corrosive unemployment that saps the communal energy and "human capital"of Black America.

We know that the major cause of it is systemic: The National Bureau of Economic Research determined that when the black unemployment rate fell to a historic low of 7 percent in the spring of 2000, it was because poor black males had rushed to take the low-wage jobs in the service sector which the 1990s dynamic of explosive job-creation had finally made available to them.

Thus, the solution has to be systemic. The solution has to be jobs for those who want to work.

That's the message we've pressed on both President Bush and Senator John Kerry when they came to speak to the National Urban League Convention last month.

It's one reason we've proposed that they commit themselves to a live televised debate this fall devoted exclusively to urban and civil rights issues. Despite the profound importance of the war against terror, these issues can't be left to languish. The July unemployment and job-creation figures show that America has a problem.

Is America's leadership paying attention?

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