Black-white wage gap widest since 1979

Washington Post -  A recent report from the Economic Policy Institute, a left-leaning think tank, shows that the black-white wage gap is now the widest it has been since 1979.

It used to be that low-skilled black workers suffered the greatest disadvantage relative to their white counterparts. But there has been a strange reversal in the past 40 years. EPI finds that the black-white wage gap has become wider — and is widening faster — among those with more education.

In 1980, black men entering the job market with just a high school diploma earned 15 percent less than similar white men on average. In contrast, black men with bachelor’s degrees or more earned only 5 percent less than similar white male college graduates.
College, in other words, once seemed a surefire route to something approaching racial equity. Nowadays, the picture is more complicated.

While the racial wage gap among less-educated men has held steady at about 15 percent, that gap for men with college diplomas increased significantly in the 1980s, and now hovers between 15 and 20 percent. In 2014, the penalty for being educated-while-black was about 18 percent. The penalty for less-educated black men was 16 percent.

A similar pattern exists for women. Among less-educated women with less than 10 years of job experience, the black-white wage gap was 6.2 percent in 2014. But among college-educated women, the wage gap was closer to 12 percent.

The authors of the report — Valerie Wilson, director of EPI's program on race, ethnicity and the economy, and William Rodgers III — calculate how different factors have contributed to these changes.


“We have minimum wages, but there isn’t a wage ceiling,” Wilson said. “There’s much more room for discrimination and inequality at the top. What’s happened is that the top one percent have really pulled away.”

Income growth in recent decades has been limited, more or less, to the highest echelon of earners, a group that is overwhelmingly white. Out of every 1,000 households in the top 1 percent, only two are black, while about 910 are white. And so, as economic forces lifted the incomes of the 1 percent, the blacks on lower rungs of the economic ladder have been largely left behind.