The Black Jobs Deficit Cost Black America $87 Billion in 2025

In 2025, Black America needed about 1.8 million more people working to have the same employment rates (employment-to-population ratios) as White America (Table 1). This Black jobs deficit cost Black America about $87 billion in lost income.

Black people face higher rates of joblessness because of racial discrimination in the labor market. Researchers continue to find strong evidence of anti-Black bias in hiring. Even among the formerly incarcerated, White individuals are more likely to find employment than Black individuals. Persistent racial discrimination in the labor market can lead Black individuals to become discouraged and not actively attempt to find work.

Black communities also experience high rates of poverty and economic underdevelopment which leads to lower educational achievement and fewer job opportunities. Researchers at Brandeis University find that in America’s 100 largest metropolitan areas, 61 percent of Black children live in low or very low opportunity neighborhoods while 68 percent of White children live in high or very high opportunity neighborhoods — a stark contrast. These family and community socioeconomic disadvantages also contribute to higher rates of Black joblessness.

Black America appears to be the leading edge of a coming economic downturn. The Black jobs deficit has increased by nearly 20 percent from 2024 to 2025. In 2024, the Black jobs deficit was 1.5 million jobs.

Table 1

If policymakers reduce the Black jobs deficit, they will improve economic conditions for Black families, Black neighborhoods, and ultimately the entire United States. When more Americans are living up to their full economic potential, the country is stronger. Two steps to achieve these goals would be (1) to commit to anti-discrimination and equal opportunity in hiring, and (2) to invest in subsidized employment and economic development programs in disadvantaged communities.

There are numerous, effective model subsidized employment programs. For example, with the New Hope for Families and Children program, after individuals’ enrollment in the program ended, there continued to be higher rates of employment, earnings and children’s academic achievement among the participants. The program had such positive outcomes that it is estimated to pay for itself in the long run. With smart investments, policymakers can create a more economically productive society for all.

This first appeared on CEPR.

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