Black/White Wage Gap Shrinks, But Remains High
The black/white wage gap shrank by 10.8% in the first two quarters of 2009 compared with a decade ago, according to a new report.
“When the employment market is really good then the wage gaps narrow, but when we’ve had a very bad labor market like in the last years, then it is not as good for those groups that are disadvantaged,” says David Finegold, dean of the Rutgers’ University’s School of Management and Labor Relations, which released the report Monday.
As of August 2009, the current unemployment rate stands at 9.7% nationally and full-time black and Hispanic workers earn 21.5% and 27.5% less than white workers, respectively. However, the respective gaps were 24.1% and 34.1% a decade ago.
In addition, while the black/white wage gap has increased by 7.9% in the past year, the Hispanic/white wage gap grew by only 0.8%.
“A rise in the real level of the minimum wage—which has been fairly robust over the last few years– can be a big benefit in closing the gap at the lower end of the earnings distribution,” says Finegold. The current federal minimum wage is now $7.25 an hour, or 9% percent higher than in 1999 after adjusting for inflation. Finegold added that enforcement of laws against unfair labor practices, like the Lilly Ledbetter Act of 2009, which fights pay discrimination, will have a beneficial effect on the wage gap for women and minorities.
The report also tracked inflation-adjusted earnings for all wage and salary workers, and included information about worker access to employment-sponsored retirement plans, health insurance, and bonus and performance related pay.
–Marcia Wade Talbert