Equal Employment Opportunity: Displacement Rates, Unemployment Spells, and Reemployment Wages by Race

U.S. Government Accountability Office

Equal Employment Opportunity:

Displacement Rates, Unemployment Spells, and Reemployment Wages by Race

HEHS-94-229FS: Published: Sep 16, 1994. Publicly Released: Sep 16, 1994.

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Pursuant to a congressional request, GAO reviewed whether blacks were disproportionally affected by the 1990 through 1991 recession, focusing on: (1) job displacement rates; (2) the length of unemployment for displaced workers of all racial groups; and (3) the reemployment wages of displaced workers.

GAO noted that: (1) during the 1990 through 1991 recession, blacks were 15 percent more likely to lose their jobs than whites; (2) of the four racial groups examined, Hispanic and black workers had the highest layoff rate and Asians had the lowest layoff rate; (3) although the high displacement rate among blacks was due in part to the recession's impact on industries and occupations in which they were overrepresented, differences persisted after accounting for industrial and occupational affiliations, education levels, and worker age; (4) displaced black workers were unemployed slightly longer than workers in the other groups; (5) between 1990 and 1991, black workers averaged about 12 weeks of unemployment, white workers averaged 11 weeks of unemployment, and Hispanics averaged 10 weeks of unemployment; (6) although reemployed black workers experienced the highest loss in weekly earnings, white and Hispanic employees experienced average earnings losses of about 9.5 percent and 5.3 percent, respectively; (7) during years of economic growth, workers of all races experienced less job displacement and displaced workers spent less time on unemployment; and (8) black workers consistently experienced the worst labor market outcomes regardless of the state of the economy.