On February 3, 2012, Dean Baker of the Center for Economic and Policy Research (CEPR) released an analysis showing that levels of unemployment in African-American and Latino communities had dropped significantly this January. Baker states of the January data released by the Department of Labor:

"The Labor Department reported that the unemployment rate fell to 8.3 percent in January, bringing its drop over the last year to 0.8 percentage points. African Americans in particular saw an especially sharp decline in unemployment, with their overall rate falling by 2.2 percentage points to 13.6 percent, the lowest level since March of 2009. The unemployment rate for African American men over age 20 fell by 3.0 percentage points to 12.7 percent, the lowest level since November of 2008. The drop for women over age 20 was 1.3 percentage points to 12.6 percent. The unemployment rate for Hispanics dropped by 0.5 percentage points to 10.5 percent, the lowest since January of 2009."

Baker qualifies his analysis by stating that the DOL numbers are "erratic" and may be "partially reversed" in future monthly employment reports. Another important point that the CEPR analysis teases out of the data is that the overall unemployment rate for white workers fell by 0.1 percent, compared to much larger gains for African-American and Latino workers. None-the-less, job creation in communities of color will have to accelerate at a considerably faster rate to add enough jobs to reduce disproportionately higher levels of unemployment, and to match the entry of new works into the labor force. While the unemployment level for African-American women overage 20 fell by 1.3 percentage points to 12.6 percent, this level of unemployment is almost double of that experienced by white women over age 20, who have an unemployment rate of 6.8 percent.

A final point of consideration is that even with the employment gains in communities of color, systemic labor market segmentation is likely reducing the potential benefits of higher employment to all workers. As the Network has noted, the median household income for a female headed household in 2010 was $32,031, compared to a median income for all households of $49,445. This disparity is considerably more pronounced for African-American and Latina female headed households, as evidenced by the chart (below) from a Network policy brief. The evidenced pay inequities highlight the need for policies to reduce unemployment, and policies to provide income supports for those communities only partially benefiting from a perceived economic recovery.

Yesterday, in a 2-1 decision, a federal appeals court found that California's same-sex marriage ban, Proposition 8, was unconstitutional. The ruling was a victory for gay rights advocates, and upheld a prior decision by a U.S. District Court in 2010, which overturned the marriage ban. California voters approved Proposition 8 in 2008 by referendum but the law was quickly challenging in U.S. District Court in Perry v. Schwarzenegger.

Below is an excerpt from the decision, which can be found in its entirety here.
 
"Although the Constitution permits communities to enact most laws they believe to be desirable, it requires that there be at least a legitimate reason for the passage of a law that treats different classes of people differently. There was no such reason that Proposition 8 could have been enacted. Because under California statutory law, same-sex couples had all the rights of opposite-sex couples, regardless of their marital status, all parties agree that Proposition 8 had one effect only. It stripped same-sex couples of the ability they previously possessed to obtain from the State, or any other authorized party, an important right--the right to obtain and use the designation of 'marriage' to describe their relationships. Nothing more, nothing less. Proposition 8 therefore could not have been enacted to advance California's interests in child-rearing or responsible procreation, for it had no effect on the rights of same-sex couples to raise children or on the procreative practices of other couples. Nor did Proposition 8 have any effect on religious freedom or on parents' rights to control their children's education; it could not have been enacted to safeguard these liberties."
 

On February 6, 2012, Policy Link issued a report entitled, "Fostering Equitable Foreclosure Recovery," which outlines strategies to alleviate the social costs of the foreclosure crisis. The report highlights, as the Network blog has in the past, that communities of color have been disproportionately impacted by the foreclosure crisis. As home ownership has historically been a major vehicle towards asset development in the United States, the long-term financial security of countless Black and Latino homeowners has been weakened.

While the report outlines the direct impact that the foreclosure crisis has had on those home owners in default or delinquency, it also highlights that neighborhoods themselves are adversely impacted by the negative externalities of the housing mortgage crisis. The report notes that even those who have not lost their homes are impacted by nearby foreclosures. These adverse side effects include: depreciation of home values due to nearby blight and abandonment; reductions in municipal property tax bases and subsequent funding shortfalls; and an over-supply of housing during a period of decreased demand. 

As noted in the report, the federal government provided funds - through the Neighborhood Stabilization Program (NSP) - to help alleviate the impact of the foreclosure crisis. The report analyzes how NSP related-efforts played out in three different cities: Minneapolis-St. Paul, Portland and Seattle. Based on this information and analysis, Policy Link offers recommendations on how cities can continue working towards a housing market recovery, while making the systemic changes needed to build a "just" housing finance system.

Some of the recommendations offered by the report include:

- Increasing the accessibility of safe credit to low-income and middle-income communities

- Expanding existing models for sustainable home ownership

- Empowering municipal capacity to take control of distressed properties, via community land trusts or other institutional mechanisms

- Increasing code enforcements to deter speculation by irresponsible lenders that are willing to sacrifice the health of neighborhoods for quick profits

To read the report click here, and to see Network analysis of housing policy and asset development for women of color, click here.

Last week, the Center for Law and Social Policy (CLASP) issued a policy brief highlighting the potential dangerous effects of a Congressional proposal to tie unemployment benefits (UI) to educational requirements. The bill in question, HR3630, would require that individuals receiving UI complete a high school degree, or GED, should they not already have the diploma. CLASP's analysis underscores that such a requirement would create barriers to UI for individuals with lower levels of educational attainment. Also highlighted in the report is that the educational requirements would drive up enrollment in publicly subsidized programs, which are already at capacity.

Additionally, a report last month by the Center for Budget and Policy Priorities (CBPP) emphasized the dangers implicit to the Congressional provision. The provision, according to the CBPP, "would hit large numbers of older laid-off workers," since "nearly half of UI recipients with less than a high school education [...] are over age 45..." These measures are also more likely to impact low and modest-wage workers - populations that are less likely to have developed the assets needed to ensure against economic hardship during periods of unemployment.

The Network blog has focused on other provisions that would limit access to UI, specifically proposed drug-testing requirements. Such barriers to public assistance are particularly hazardous, as they are both costly to administer, and are likely to increase economic insecurity.

The Corporation for Enterprise Development, or CFED, has published the 2011 "Assets and Opportunities Scorecard," which takes a measure of economic security and poverty across the country. The report finds high levels of poverty and low levels of asset development across the country, noting that 27 percent of households are income poor and living in "asset poverty." This marks a 21 percent increase from the 2009-2010 "Assets and Opportunities Scorecard," and highlights that around one in four families is currently struggling with financial insecurity.

The report finds that Mississippi, Nevada and Alabama are the most impacted by the economic downturn and crisis of growing poverty. In particular, the report notes:

· 45  percent of Nevada households are asset poor

· 21 percent of Mississippi households are income poor

· 65 percent of Alabama households are liquid asset poor

You might ask in regards to the third bullet, what does liquid asset poor mean? The CFED defines liquid asset poverty as a measure which "excludes assets such as a home, business or car that can't easily be converted to cash [...] consequently [providing] a more realistic picture of the resources families have to meet emergency needs."

The report finds that 43 percent of Americans qualify as liquid asset poor, underscoring the precarious economic situation facing many households. Levels of liquid asset poverty are especially troubling given other indicators included in the CFED report. The report states that 55 percent of Americans do not have, or do no participate in, a retirement plan. Given the aforementioned low levels of asset development in the U.S., it is likely that many Americans are not adequately prepared for retirement, and thus are potentially facing future economic insecurity. The Network has highlighted the pronounced gap between the retirement savings for women of color and those of their white counterparts.

Recommendations offered in Network policy analysis [PDF] concerning retirement security for women of color, reflect the recommendations offered in the CFED report. These recommendations include: government funding for human capital development, educational opportunities, in addition to statutory action to reduce asset disparities.

On the February 1, 2012 episode of ABC's Nightline, Rinku Sen - Network affiliate scholar and Executive Director of the Applied Research Center - discussed the pitfalls of American immigration policy. The Nightline segment highlighted the complications implicit to American immigration policy, and how families are continually split apart by unfair and unjust laws. Sen cited information from ARC's report, "Shattered Families," which found that approximately 5,000 children live in foster care due to the detention or deportation of their parents. 

Watch the clip here.

This week, the Neighborhood Economic Development Advocacy Project (NEDAP) released a report on the continued crisis of home foreclosure in New York State. The report notes that in New York State alone, 345,000 mortgages are in default or delinquency. Such high foreclosure rates highlight that the housing crisis continues to impact communities and decrease the economic security of countless individuals in the New York. One key point raised in the report is that recent data shows a reduction in foreclosures, but NEDAP's analysis attributes this to change to major banks' inability "to produce documentation required to initiate foreclosure cases, as New York courts heighten their scrutiny of banks' foreclosure filings."

The NEDAP report also underscores something that the Network has been highlighting for some time: communities of color are disproportionately impacted by the foreclosure crisis. The report notes that in New York, communities of color account for 64 percent of foreclosures, while representing 25.5 percent of the city's population. The National Community Reinvestment Coalition has published research showing the impact of the foreclosure crisis on communities of color across the United States - showing that New York's trends mirror those at the national level.

Just last week, the Network blog featured coverage of discriminatory mortgage lending practices by the Economic Policy Institute. The EPI noted that Black and Latino borrowers, with "good" credit, were more likely to be steered into a high risk loan than their white counterparts. NEDAP's report highlights the fallout from these practices, and the subsequent concentration of New York City's foreclosures in neighborhoods of color.

NEDAP's report also highlights the need to address the foreclosure crisis in New York State with government action. Among the recommendations included in the report is to permit loan modifications, such as "principle reduction," to bring private housing debt obligations into line with the present value of homes. Such a simple solution would help many struggling homeowners stay in their homes, prevent damage to the asset worth of countless families, and reduce the amount of underutilized housing at a time of economic crisis.

Last week, Mitt Romney's reference to "self-deportation" was added to the list of buzzwords in immigration policy. Romney's Republican opponents scoffed at the idea at first, but the roots of the seemingly contradictory "self-deportation" idea (or "attrition through enforcement" as it is also known) are embedded in stances advocated by ultra conservative anti-immigrant groups and legislators since at least 2007. While President Obama reiterated a promise of comprehensive immigration reform in the State of the Union Address, Romney asserted his support for resolving unauthorized immigration issues by compelling immigrants to leave of their own accord due to unhospitable circumstances. Alabama and Arizona have already enacted legislation designed to create unwelcoming environments for any resident who doesn't have the right papers.

Kris Kobach, Secretary of State of Kansas, vocal anti-immigrant critic and lawyer, drafted the Arizona legislation which then became a model for Alabama's bill. Kobach has voiced fears of undocumented immigrants committing voter fraud to justify stringent voter ID requirements. Opponents of his measures question the credibility of Kobach's claims saying that he has failed to substantiate his claims of mass voter fraud.

Though it's been less than a year since Alabama's legislation was passed, the effects on families in the state have been far-reaching. Supporters of the bill claim success, citing lower immigration levels and unemployment rates as compared to other states. On the ground, some Alabama legislators are regretting their decision to enact the legislation citing the flood of unintended consequences and declines in productivity. This week, NPR's This American Life featured the stories of mothers, children and workers in Alabama adjusting to the new reality under state-imposed isolation. The phrase "self-deportation" sounds efficient, painless, and relatively uncomplicated. However, the harsh implications of isolation, increased vulnerability and the climate of fear that associated policies can foster begs for a greater public understanding of the lives that are changed by the process.

Last April, the Women of Color Policy Network published a policy brief about the impacts of SB 1070 and other state-level anti-immigration policies on the people, fiscal health and public safety of states. As the GOP races heat up, it will be interesting to see how the isolation of immigrants is talked about and the nature of policy recommendations offered up on both sides.  

 

A recent report, by the Center for Economic Policy Research, shows that of all OECD nations the United States has the largest share (24.8 percent) of its labor force working in "low-wage work." The report, by CEPR Senior Economist John Schmitt, makes the important point that economic growth alone will not cure the American low-wage problem. The report highlights that:

"Higher levels of GDP per capita, for example, are not associated with a reduction in the share of low-wage workers. [...] there is no relationship between the level of per capita GDP and the low-wage share. Nor is rapid growth associated with a shrinking low-wage share. [...] the relationship between real growth in a country's GDP per capita over the period 1980-2010 is not meaningfully related to a country's low-wage share in 2009."

The CEPR analysis highlights that if economic gains are not shared equitably across society, earnings in low-wage positions will remain stagnant. The report notes that one of the reasons that the United States suffers from the highest level of low-wage work amongst industrialized nations is the lack of "inclusiveness" in the U.S. labor market. The report offers a definition of "inclusiveness" stating that nations with more "inclusive" labor markets also have an accessible safety net, strong collective bargaining institutions, and a higher share of GDP devoted to social transfers. Additionally, the CEPR report highlights that low-wage work is "not a clear-cut stepping stone to higher-wage work."

Labor market segmentation is something that the Network has focused on in our research and policy advocacy. We have noted that women of color are more likely than their white counterparts to work in a low-wage position, and are less likely to work in a position that benefits from wage growth. Please read the Network policy brief, "Wage Disparities and Women of Color," to see how the issues raised in the CEPR report uniquely impact the economic security of women of color.

Last week, the Network blog featured a post on an Economic Policy Institute analysis of discriminatory practices in the mortgage lending industry. The EPI had noted the detrimental of these practices to the net worth within communities of color. Subsequently, on January 23, 2012, the EPI released a briefing paper offering further insight into these types of discriminatory lending practices. The EPI brief, by Richard Rothstein, highlights the use of 'reverse redlining' practices by Bank of American subsidiary Countrywide in the run up to the economic crisis. The following passage from the report discusses the industry practice of 'reverse redlining.'

"Not only did this marketing of risky subprime mortgages help precipitate a worldwide financial crisis, it also reinforced, and may even have intensified, racial segregation in our major metropolitan areas. Whereas redlining kept black families out of white and middle-class neighborhoods, foreclosures stemming from reverse redlining have led to the displacement of many African American and Hispanic families who did manage to gain homeownership in stable middle-income communities..."

Research has shown the negative impacts that foreclosures have on families and children. As noted in last week's blog post, the disproportionate impact of the foreclosure crisis on communities of color has negatively impacted the racial wealth gap. Recently the Network has blogged about the Aspen Institute's Ascend program, which focuses on developing "two-generation" strategies to reduce inequality. Given the observations of the EPI, it seems clear that the policies needed to reverse these trends will need to include long-term strategies, over more than one generation.