Race and Ethnicity in the Labor Market

Of the many disturbing labor-market trends in recent years, the stagnated wage gap between races may be the most disheartening. Race continues to be America's most persistent area of social and economic disparity. Many Americans were encouraged by the steady and significant economic progress Blacks made after World War II. The recent stagnation, however, challenges that optimism. In addition, the average economic status of Hispanics appears to be deteriorating at an even more alarming rate than that of Blacks. This paper describes major, long-term trends that have had an impact on the economic status of Blacks and Hispanics, including long-term trends that appear to be influenced mostly by skill-related factors. Also addressed are alternative explanations for the 1960s-to-1990s stagnation in the economic position of minority households; explanations include changes in schooling, quality of students, affirmative action, and rising wage inequality. In addition, the role of immigration in altering the labor-market position of Hispanic workers is analyzed.