Black-White Wage Gaps in the Age of Growing Inequality, 1979-2014
AbstractThis study revisits the trend and decomposition analyses of black-white wage gaps that dominated the literature from the 1960s through the 1990s. We update and extend previous studies by examining what has happened to the black-white wage gap since the late 1990s. Our analysis affirms that the black-white wage gap among men expanded during the 1980s and narrowed significantly during the 1990s. Our major contribution is an assessment of what has been the pattern or trend for men since the late 1990s. We also assess the patterns in the black-white wage gap among women since the late 1980s.
We describe the broad trends and patterns in black-white wage inequality for men and women overall, as well as by experience and educational attainment, during each of these periods. Our primary finding is that there is no single African American labor market narrative. Black-white wage gaps are larger today than they were in 1979, but the African American experience is not monolithic. In fact, the post-2000 patterns show that the heterogeneity of experiences has increased. Since 2000, forces larger than the Great Recession disadvantaged African Americans. Changes in unobservable skills and cut backs in political and financial support to fight labor market discrimination are leading factors for explaining the recent deterioration in the position of many African Americans. However, the experience of older African Americans continues to partially insulate them from factors associated with growing racial inequality.