Figures behind our “targeting the Black rate” essay

June 14th, 2020 at 9:18 am

Janelle Jones and I have a new piece coming out wherein we explain why and how the Federal Reserve should target the Black unemployment rate in setting monetary policy.

The first figure to which we refer is the share of quarters since 1972 (when the Black jobless rate data start) that the unemployment rate for different racial groups has been below CBOs estimate of the “natural rate.” Whites enjoyed full employment labor markets almost 60% of that time. The Black rate, conversely, has never fallen below the estimated full employment rate (which I’ve, for the record, long argued is biased up, meaning these figures are optimistic).

Source: BLS, CBO

The next figure relates to our discussion of who benefits most from tight labor markets. It shows that pre-crisis, the pace of nominal Black median weekly earnings surpassed that of Whites.

Source: BLS

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One comment in reply to "Figures behind our “targeting the Black rate” essay"

  1. Kevin Rica says:

    That approach would also be useful in setting immigration policy.

    if there are no jobs for young black men in inner-city Baltimore, there are no jobs for unskilled, non-English-speaking immigrants. The will just absorb the few jobs at the lower end and drive down wages.


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