African-American Middle Class Eroding As Unemployment Rate Soars

The unemployment situation across America is bad, no doubt. But for African-Americans in some cities, this is not the great recession. It’s the Great Depression.

Take Charlotte, N.C., for example. It is a jewel of the “new South.” The largest financial center outside of New York City, it's the showcase for next year’s Democratic National Convention. It was a land of hope and opportunity for many blacks with a four-year college degree or higher.

According to an analysis by the Economic Policy Institute, in Charlotte, N.C., the unemployment rate for African-Americans is 19.2 percent. If you add in people who have given up looking for jobs, that number exceeds 20 percent, which, according to economists Algernon Austin and William Darity, has effectively mired blacks in a depression.

“You’re looking at a community that is economically depressed in my opinion,” Austin said. “And we need action that will address that scale of joblessness.”

Vanessa Parker worked hard to get ahead. She was an administrative assistant at IBM in Charlotte. She went to night school to better herself, graduating with a bachelor’s degree in finance. Parker and her husband saved up enough money to move from a bad neighborhood to a quiet, middle-class street. But instead of moving up in the company, IBM moved out. Now she works at a big-box store for minimum wage.

“It’s very frustrating and it makes you wonder why are you doing it,” she told me. “Because it seems like the more that you try to get ahead, seems like you’re falling back.”

“It takes time to build anything. But it doesn’t take very long to destroy it,” says Patrick Graham of the Urban League of Central Carolina.

His organization runs classes on empowerment, hoping to raise the self-esteem of the unemployed and give them the confidence to take charge of their lives.

“It’s heartbreaking,” he told me. “In a sense that you watch people who are viable who have talent who can’t necessarily find the job opportunity that they need.”

Derrick Foxx is another example of how deeply this recession has affected the black middle class. Foxx was laid off from Phillip Morris Tobacco 2 years ago and hasn’t worked a day since.

Like Vanessa Parker, Foxx was trying to better himself, attaining an MBA. Though he has sent out more than 1,000 resumes, and contacted more than 1,000 companies, he is still unemployed.

“I got out of school and didn’t get the job I was looking for,” he says. “Then I went back, got an MBA degree, you know, and I’m almost like – wow – was this really worth it?"

It’s quite a sign of the times that people are questioning whether their education was worth all the time, effort and expense. Education is supposed to be the gateway to prosperity. But according to economist William Darity from Duke University, education does not provide the same key for African-Americans to open that gate as it does for others.

“It’s really, actually, a tragedy because people have invested a tremendous amount of effort – devoted the motivation and time to acquire degrees,” he said. “But it doesn’t provide them with the same degree of protection that it provides others in this society.”

There are jobs to be had in Charlotte. But African-Americans are not sharing in the recovery in the way others are.

Devah Pager, a sociologist at Princeton University, conducted groundbreaking research in Wisconsin and found that black men were less likely to be called back on a job application than white men with a criminal record. The statistics went like this:

Job call-backs:
White non-criminal: 34%
White criminal: 17%
Black non-criminal: 14%
Black criminal: 5%

According to Darity, “The differential in unemployment between blacks and non-blacks in the U.S. is perhaps one of the most dramatic indicators of discrimination in this society.”

So – what to do about it?

The Congressional Black Caucus has been leaning on President Obama to address the epidemic of black unemployment on his watch. So far, the president has resisted the notion of job programs specifically targeting African-Americans. His position is that a rising tide will lift all boats. But the tide remains out as far as job creation goes.

The Urban League’s Patrick Graham believes small business should be the major driver to employ African-Americans.

“It’s gonna really not just take hard work, but it’s gonna really take some creative thinking in terms of entrepreneurship and other things to really get us out of this,” he said.

The recession – or depression -- in the black community is rapidly eroding the black middle class.

At its convention in Boston this week, the National Urban League released a troubling report on that topic. It found that the recession has virtually wiped out all of the economic gains blacks made in the past 30 years.

And a new report from the Pew Research Center drives home just how bad things are out there.

It found that in 2005, the average net worth for white households was $134, 992. For black households, it was $12,124. (That's not a typo.)

In 2009, the number dropped to $113,149 for whites and a paltry $5,700 for blacks.

Algernon Austin believes the government hasn’t taken the problem seriously enough. “It’s just one step below the scale of the Great Depression,” he said. “But we haven’t treated it as a crisis of that magnitude.”

Despite their plight, both Vanessa Parker and Derrick Foxx have remained remarkably upbeat. Foxx finds purpose in coaching girls’ basketball, and helping disadvantaged youth. “My biggest thing is -- if I’m helping others, you know, it takes the pain off of me,” he says. “Because I see someone else who’s doing worse than I’m doing."

Vanessa Parker is struggling to hang on to what she has built. She doesn’t want to go back to the gunshots and – as she says – the “boom, boom, boom” music of her old neighborhood.

And she truly believes better times are ahead.

“On many days I went to bed crying because I feel that I can’t get the job that I deserve. But then when I think about it, that a better day is coming -- that keeps me going. It keeps me going to that $7.25 job. You know, because something is better than nothing,” she said.