Analysis: European and Latino Americans both saw an increase in their unemployment rate from November with an increase of 20 and 40 basis points, respectively. African and Asian Americans both had decreases in their unemployment rate with decreases of 60 and 40 basis points for both groups from November, respectively.
AFRICAN AMERICAN UNEMPLOYMENT RATE BY GENDER & AGE
AFRICAN AMERICAN MEN: 4.6%
AFRICAN AMERICAN WOMEN: 4.8%
AFRICAN AMERICAN TEENAGERS: 18.0%
AFRICAN AMERICAN PARTICIPATION BY GENDER & AGE
AFRICAN AMERICAN MEN: 69.2%
AFRICAN AMERICAN WOMEN: 63.2%
AFRICAN AMERICAN TEENAGERS: 30.7%
Analysis: African American Men saw a significant decrease in their unemployment rates by 180 basis points while African American Women remain unchanged from November. African American Men and Women both had decreases in their participation rate from November of 10 basis points and 40 basis points, respectively. Extreme volatility with African American Teenagers remains as their unemployment rate skyrocketed by 5800 basis points, but also seeing their participation rate decrease by 80 basis points.
African American Men-Women Job Gap: African American Women currently have 665,000 more jobs than African American Men in December. This is a decrease from 890,000 in November.
CONCLUSION: The overall economy added 216,000 jobs in December while African America gained 66,000 jobs. From NPR, “For all of 2023, employers added 2.7 million jobs. That’s a slowdown from the two previous years, when the economy was red-hot, rapidly rebounding from pandemic layoffs. But last year’s job growth was still stronger than every other year since 2015.”
A report by Merchant Maverick, a comparison site that reviews small business software and services, highlighted the top ten states for African American entrepreneurs in 2022. The results showed that eight of those states were home to HBCUs and the other two were Nevada and New Mexico, respectively. It certainly is likely that HBCUpreneurs are driving the African American entrepreneurship in these states. Unfortunately, it maybe more indirectly than intentionally. It does suggest though that with more intentional infrastructure these states could see even more boom in entrepreneurship for HBCUpreneurs. What is that intentional infrastructure? Incubators, accelerators, mentorship, and financing programs located on the campuses of HBCUs or through their alumni associations in partnership with African American Financial Institutions (AAFIs).
Virginia: Thanks to a trio of top five metrics, Virginia ranks soundly in the No. 1 spot. Black-run businesses employ 2.18% of the Old Dominion’s workforce (2nd nationally), and there are 755 Black-owned employer businesses per 1 million people (3rd nationally). Black-owned businesses also average an annual payroll of $437K, which ranks 5th overall. The state previously fared well in some of our other data reports — Virginia finished as the 4th-best state for Black women-owned businesses, and it ranked 10th in our recent best states for women-led startup report. In an effort to grow local minority-run businesses and encourage contracts with those businesses, the Virginia state government operates a directory of all certified small businesses within the state.
Maryland: With Black residents comprising 31% of the population, Maryland has the highest percentage of Black residents of any state on the East Coast, and the 4th-highest in the nation. As such, it shouldn’t be much of a surprise that Maryland has many Black business owners. The Free State ranks 1st nationally for the most Black-owned businesses per 1 million people (1,213), and also ranks 1st in percent of the workforce employed by Black-owned businesses (3.49%). Black-owned Maryland businesses additionally average a very respectable annual payroll of $465K, which is the 4th-highest in the nation. The state government offers several tools for minority business owners, including funding, small business certifications, and assistance programs.
Texas: While no metric clearly stands out, Texas ranks highly thanks to consistency. Black entrepreneurs may find it profitable to start a business in the Lone Star State — Black business owners average an annual income of $64,240 (10th overall) and Black-run businesses in the state average an annual payroll of $337K (17th overall). All of this cash can go further in Texas because the state lacks income tax. Resources available to local Black businesses include the Texas Black Expo and the Dallas Black Chamber of Commerce, both of which are organizations that aim to assist underserved businesses.
For the full report, visit Merchant Maverick here.
Analysis: Asian Americans were the only group to see an increase in their unemployment rate from October with a 40 basis point increase. European and Latino American both had decreases in their unemployment rate with a 20 basis point decrease for both groups from October.
AFRICAN AMERICAN UNEMPLOYMENT RATE BY GENDER & AGE
AFRICAN AMERICAN MEN: 6.4%
AFRICAN AMERICAN WOMEN: 4.8%
AFRICAN AMERICAN TEENAGERS: 12.2%
AFRICAN AMERICAN PARTICIPATION BY GENDER & AGE
AFRICAN AMERICAN MEN: 69.2%
AFRICAN AMERICAN WOMEN: 63.6%
AFRICAN AMERICAN TEENAGERS: 31.6%
Analysis: African American Men and Women saw an increase and decrease in their unemployment rates by 110 and 50 basis points, respectively. African American Men saw a 170 basis point increase in their participation rate from October while African American Women had a 10 basis point decrease in their participation rate from October. African American Teenagers remain an extremely volatile group with their unemployment rate plummet by 660 basis points, but also seeing their participation rate increase by 60 basis points.
African American Men-Women Job Gap: African American Women currently have 890,000 more jobs than African American Men in November. This is a decrease from 970,000 in October.
CONCLUSION: The overall economy added 199,000 jobs in November while African America gained 264,000 jobs. From CNBC, “The data first raised concerns that the economy was running too hot for inflation to cool enough for the Fed to start retreating from its high-rates policy. Some traders expect the Fed to start cutting rates as early as next spring, with its latest policy meeting set for Wednesday.”
At the end of 2022, African America had asset values totaling $6.2 trillion and liability values totaling $1.5 trillion. Below is a breakdown of those by wealth component by assets and liabilities as reported by the Federal Reserve’s Distribution of Household Wealth data. African American assets amounted to 5% of U.S. Household assets and African American liabilities amounted to 8.8% of U.S. Household liabilities.
HBCU Money took a look at what exactly the African American asset portfolio entailed. African Americans are highly concentrated in two main areas, real estate and retirement accounts (pensions and 401K), respectively. These two groups comprise almost 70 percent of African American assets versus only 43 percent for European Americans. Corporate equities/mutual funds and private business ownership comprise a staggering 35.1 percent of European American assets versus only 9.6 percent for African Americans, these two categories also representing African America’s lowest asset holdings.
Examining where African America puts its money and theorizing why can give us insight into strategies that can help in closing both household and institutional wealth gaps.
ASSETS
Real estate – $2.15 trillion
Definition: Real estate is defined as the land and any permanent structures, like a home, or improvements attached to the land, whether natural or man-made.
% of African America’s Assets – 33.1%
% of U.S. Household Real Estate Assets – 6.1%
10 Year % Growth – 187%
Consumer durable goods – $550 billion
Definition: Consumer durables, also known as durable goods, are a category of consumer goods that do not wear out quickly and therefore do not have to be purchased frequently. They are part of core retail sales data and are considered durable because they last for at least three years, as the U.S. Department of Commerce defines. Examples include large and small appliances, consumer electronics, furniture, and furnishings.
% of African America’s Assets – 7.2%
% of U.S. Household Assets – 7.3%
10 Year % Growth – 81%
Corporate equities and mutual fund shares – $270 billion
Definition: A stock, also known as equity, is a security that represents the ownership of a fraction of the issuing corporation. Units of stock are called “shares” which entitles the owner to a proportion of the corporation’s assets and profits equal to how much stock they own. A mutual fund is a pooled collection of assets that invests in stocks, bonds, and other securities.
% of African America’s Assets – 4.9%
% of U.S. Household Assets – 1.1%
10 Year % Growth – 90%
Defined benefit pension entitlements – $1.57 trillion
Definition: Defined-benefit plans provide eligible employees with guaranteed income for life when they retire. Employers guarantee a specific retirement benefit amount for each participant based on factors such as the employee’s salary and years of service.
% of African America’s Assets – 24.7%
% of U.S. Household Assets – 10.5%
10 Year % Growth – 51%
Defined contribution pension entitlements – $600 billion
Definition: Defined-contribution plans are funded primarily by the employee. The most common type of defined-contribution plan is a 401(k). Participants can elect to defer a portion of their gross salary via a pre-tax payroll deduction. The company may match the contribution if it chooses, up to a limit it sets.
% of African America’s Assets – 11.8%
% of U.S. Household Assets – 8.0%
10 Year % Growth – 163%
Private businesses – $350 billion
Definition: A private company is a firm held under private ownership. Private companies may issue stock and have shareholders, but their shares do not trade on public exchanges and are not issued through an initial public offering (IPO). As a result, private firms do not need to meet the Securities and Exchange Commission’s (SEC) strict filing requirements for public companies.1 In general, the shares of these businesses are less liquid, and their valuations are more difficult to determine.
% of African America’s Assets – 4.7%
% of U.S. Household Assets – 2.2%
10 Year % Growth – 106%
Other assets – $700 billion
Definition: Alternative investments can include private equity or venture capital, hedge funds, managed futures, art and antiques, commodities, and derivatives contracts.
% of African America’s Assets – 13.6%
% of U.S. Household Assets – 4.2%
10 Year % Growth – 136%
LIABILITIES
Home Mortgages– $770 billion
Definition: Debt secured by either a mortgage or deed of trust on real property, such as a house and land. Foreclosure and sale of the property is a remedy available to the lender. Mortgage debt is a debt that was voluntarily incurred by the owner of the property, either for purchase of the property or at a later point, such as with a home equity line of credit.
% of African America’s Liabilities – 56.1%
% of U.S. Household Liabilities – 7.2%
10 Year % Growth – 53.3%
Consumer Credit – $710 billion
Definition: Consumer credit, or consumer debt, is personal debt taken on to purchase goods and services. Although any type of personal loan could be labeled consumer credit, the term is more often used to describe unsecured debt of smaller amounts. A credit card is one type of consumer credit in finance, but a mortgage is not considered consumer credit because it is backed with the property as collateral.
% of African America’s Liabilities – 42.1%
% of U.S. Household Liabilities – 14.1%
10 Year % Growth – 91.7%
Other Liabilities – $30 billion
Definition: For most households, liabilities will include taxes due, bills that must be paid, rent or mortgage payments, loan interest and principal due, and so on. If you are pre-paid for performing work or a service, the work owed may also be construed as a liability.
“With segregation, with the isolation of the injured and the robbed, comes the concentration of disadvantage. An unsegregated America might see poverty, and all its effects, spread across the country with no particular bias toward skin color. Instead, the concentration of poverty has been paired with a concentration of melanin.” – Ta-Nehisi Coates
HBCUs and PBIs are arguably African American institutions that are built to solve and protect African American interests. There is no greater crisis that currently faces African American economically than its poverty. Its impact across all statistics like health outcomes, civic participation, business creation, student loan debt, and the list goes on and on. What exactly HBCUs and PBIs are doing about African American poverty in their cities and states is complicated to address. Many would say that simply graduating the number of African Americans with degrees is more than enough. That is until you realize the depth and impact our counterparts are using their higher educational institutions to do. MIT has an incubator that allows students to create companies while matriculating. Schools like Stanford have helped create Google, Harvard is the birthplace of Facebook, University of Texas and Texas A&M formed UTIMCO to create the nation’s largest endowment, and much more. PWIs banking with banks like J.P. Morgan, Wells Fargo, and others ensuring that European American owned banks have a deposit base that allows them to conduct the business of financially protecting their community and lending for European American homeownership and small business creation. HBCUs, not so much. It is also not just the HBCUs, but HBCU foundations, HBCU alumni associations, and other organizations that are supposed to be part of the vanguard/ecosystem of African American institutional development that pulls African American individuals, families, and communities away from poverty in conjunction with other African American institutions.
Poverty is already a complex and layered system and African American poverty is that on steroids. Each state and the HBCU/PBIs institutional system in it are part of the counterattack against African American poverty. Or at least we want them to be. For the alumni and administrations who see their institutional system as part of the empowerment and pulling of African America out of the throws of poverty it requires to know the actual depths of the situation.
Among the U.S. states with the highest poverty rates for 2022, HBCU/PBI states constituted 8 out of the top 10 for overall poverty.
ALABAMA
Overall Poverty (2020): 15.5%
Overall Poverty (2015): 19.3%
African American Poverty (2020): 23.5%
African American Poverty (2015): 31.1%
Change In African American Poverty 2015-2020: Decreased 24.4%
ARKANSAS
Overall Poverty (2020): 16.2%
Overall Poverty (2015): 18.9%
African American Poverty (2020): 27.1%*
African American Poverty (2015): 33.2%*
Change In African American Poverty 2015-2020: Decreased 18.4%
CALIFORNIA
Overall Poverty (2020): 11.8%
Overall Poverty (2015): 16.5%
African American Poverty (2020): 19.0%*
African American Poverty (2015): 25.4%*
Change In African American Poverty 2015-2020: Decreased 25.2%
DELAWARE
Overall Poverty (2020): 11.3%
Overall Poverty (2015): 12.5%
African American Poverty (2020): 17.3%
African American Poverty (2015): 19.9%
Change In African American Poverty 2015-2020: Decreased 13.1%
DISTRICT OF COLUMBIA
Overall Poverty (2020): 13.5%
Overall Poverty (2015): 17.7%
African American Poverty (2020): 21.6%*
African American Poverty (2015): 25.9%*
Change In African American Poverty 2015-2020: Decreased 16.6%
FLORIDA
Overall Poverty (2020): 12.7%
Overall Poverty (2015): 16.5%
African American Poverty (2020): 19.8%*
African American Poverty (2015): 26.9%*
Change In African American Poverty 2015-2020: Decreased 26.4%
GEORGIA
Overall Poverty (2020): 13.3%
Overall Poverty (2015): 18.3%
African American Poverty (2020): 18.8%
African American Poverty (2015): 27.0%
Change In African American Poverty 2015-2020: Decreased 30.1%
ILLINOIS
Overall Poverty (2020): 11.5%
Overall Poverty (2015): 14.4%
African American Poverty (2020): 24.2%*
African American Poverty (2015): 30.6%*
Change In African American Poverty 2015-2020: Decreased 20.9%
KENTUCKY
Overall Poverty (2020): 16.3%
Overall Poverty (2015): 19.1%
African American Poverty (2020): 24.4%*
African American Poverty (2015): 32.4%
Change In African American Poverty 2015-2020: Decreased 24.7%
LOUISIANA
Overall Poverty (2020): 19.0%
Overall Poverty (2015): 19.8%
African American Poverty (2020): 29.4%*
African American Poverty (2015): 33.7%*
Change In African American Poverty 2015-2020: Decreased 12.8%
MARYLAND
Overall Poverty (2020): 9.0%
Overall Poverty (2015): 10.1%
African American Poverty (2020): 12.9%
African American Poverty (2015): 14.6%*
Change In African American Poverty 2015-2020: Decreased 11.6%
MASSACHUSETTS
Overall Poverty (2020): 9.4%
Overall Poverty (2015): 11.6%
African American Poverty (2020): 17.6%
African American Poverty (2015): 21.8%
Change In African American Poverty 2015-2020: Decreased 19.3%
MICHIGAN
Overall Poverty (2020): 13.0%
Overall Poverty (2015): 16.2%
African American Poverty (2020): 25.9%*
African American Poverty (2015): 33.0%*
Change In African American Poverty 2015-2020: Decreased 21.5%
MISSISSIPPI
Overall Poverty (2020): 19.6%
Overall Poverty (2015): 21.5%
African American Poverty (2020): 30.7%
African American Poverty (2015): 34.3%*
Change In African American Poverty 2015-2020: Decreased 10.5%
MISSOURI
Overall Poverty (2020): 12.9%
Overall Poverty (2015): 15.5%
African American Poverty (2020): 21.2%
African American Poverty (2015): 28.1%*
Change In African American Poverty 2015-2020: Decreased 24.6%
NEW YORK
Overall Poverty (2020): 13.0%
Overall Poverty (2015): 15.9%
African American Poverty (2020): 20.0%
African American Poverty (2015): 23.2%
Change In African American Poverty 2015-2020: Decreased 13.8%
NORTH CAROLINA
Overall Poverty (2020): 13.6%
Overall Poverty (2015): 17.2%
African American Poverty (2020): 21.5%
African American Poverty (2015): 26.5%
Change In African American Poverty 2015-2020: Decreased 18.9%
OHIO
Overall Poverty (2020): 13.1%
Overall Poverty (2015): 15.8%
African American Poverty (2020): 27.3%*
African American Poverty (2015): 34.7%*
Change In African American Poverty 2015-2020: Decreased 21.3%
OKLAHOMA
Overall Poverty (2020): 15.2%
Overall Poverty (2015): 16.6%
African American Poverty (2020): 28.2%*
African American Poverty (2015): 29.9%*
Change In African American Poverty 2015-2020: Decreased 5.7%
PENNSYLVANIA
Overall Poverty (2020): 12.0%
Overall Poverty (2015): 13.6%
African American Poverty (2020): 24.9%
African American Poverty (2015): 29.5%
Change In African American Poverty 2015-2020: Decreased 15.6%
SOUTH CAROLINA
Overall Poverty (2020): 13.8%
Overall Poverty (2015): 16.8%
African American Poverty (2020): 23.1%*
African American Poverty (2015): 26.0%
Change In African American Poverty 2015-2020: Decreased 11.2%
TENNESSEE
Overall Poverty (2020): 13.9%
Overall Poverty (2015): 18.3%
African American Poverty (2020): 21.5%
African American Poverty (2015): 30.9%
Change In African American Poverty 2015-2020: Decreased 30.4%
TEXAS
Overall Poverty (2020): 13.6%
Overall Poverty (2015): 17.2%
African American Poverty (2020): 18.6%
African American Poverty (2015): 23.2%
Change In African American Poverty 2015-2020: Decreased 19.8%
VIRGINIA
Overall Poverty (2020): 9.9%
Overall Poverty (2015): 11.8%
African American Poverty (2020): 16.4%*
African American Poverty (2015): 21.2%*
Change In African American Poverty 2015-2020: Decreased 22.6%
*Denotes that African Americans had the highest poverty rate among all groups during that period.
HBCU Money 