Why Black unemployment just rose to its highest level since January 2022

CNN

04-07-2025

Unemployment among Black Americans last month reached its highest level in more than three years, in stark contrast to the broader labor market's resilience.
The jobless rate for Black Americans climbed to 6.8% in June, the Labor Department said Thursday, up sharply from May's 6% and the highest level since January 2022.
Meanwhile, the national unemployment rate ticked down to 4.1% and employers added a stronger-than-expected 147,000 jobs in June, according to Thursday's jobs report. Joblessness also declined for Whites, Hispanics and Asians.
President Donald Trump's chaotic trade war, which paralyzed business decision-making and sparked fears of higher prices, was one factor in the rise in Black unemployment. For months, businesses have said the Trump administration's significant policy changes — from on-again, off-again tariffs to cuts in federal funding — have made it difficult to plan ahead, prompting some to put hiring plans on hold, according to various surveys.
Black Americans are usually impacted first whenever the economy begins to weaken, economists say. Black Americans lag behind their White counterparts in income, wealth, financial savings and home ownership, according to previous CNN reporting. Additionally, the Trump administration has placed diversity, equity and inclusion programs in its crosshairs.
'When the economy slows down, Black workers may be impacted more quickly or more severely,' said Daniel Zhao, senior economist at Glassdoor. 'But it's consistent with the broader story for all workers of unemployment trending upwards over the last two years. We've just seen more of that for Black workers.'
And while the broader labor market seems to be chugging along, that has mostly been due to a few industries: health care, local government and hospitality.
In June, the private education and health services industry was up a remarkable 411,000 net jobs compared to six months ago, according to Labor Department data. All other industries, except government and hospitality, added fewer than 51,000 jobs each during that same period.
'Black Americans tend to work in transportation, warehousing and utilities, which are industries where we've seen hiring pulled back, especially in the last few months,' said Cory Stahle, senior economist at employment site Indeed. 'Businesses are trying to figure out what they're going to commit to as far as pricing, spending and hiring while trying to navigate these tariffs and the uncertainty.'
Black Americans may also be feeling the brunt of the Trump's administration's aggressive downsizing of the federal government, which shed 7,000 jobs last month. Federal employment is down 69,000 from January, according to the Labor Department.
'Job losses in the federal government have continued, which could be explaining part of what's going on, especially as the administration targets Diversity, Equity, and Inclusion programs,' said Jessica Fulton, senior fellow at the Joint Center for Political and Economic Studies, a nonprofit that studies the challenges facing Black Americans. 'Black Americans are more likely to work in federal government in particular.'
Zhao, Stahle and Fulton all said it's too soon to make any decisive conclusions about the economic state of Black Americans based the latest employment figures.
The household survey the Labor Department uses to calculate monthly employment figures draws from relatively small sample sizes for different racial and ethnic groups, making the numbers more prone to swings from month to month.
Despite the labor market's resilience, the economy has shown some signs of weakness in other areas. In addition to the limited job growth in most industries, consumer spending fell after tariff-induced spending sprees in the spring.