The Declining Black Middle Class in Economic Recovery

The economic downturn has made many Americans rethink their current class status.  According to recent study by ABC News, 45 percent of Americans define themselves as middle class, while 39 percent who see themselves as working class, and 14 percent as upper-middle class.

From a racial perspective, there has been a growing black middle class in the United States since the 1970s.  The 2000 U.S. Census reported that 16 percent of blacks have a bachelor’s degree or higher, as compared to 24 percent of the U.S. population as a whole have.  Forty-six percent of blacks lived in an owner-occupied housing unit. The black median household income was $29,423, and 25 percent of the black employed are in management and professional occupations.

When the 2010 U.S. Census is taken next month, the new statistics will not only reflect the greater wage gaps causes mostly by the recession, but also the growing social and economic problems within black communities that are not being addressed.  Despite the progress African Americans have made over the years to be part of the middle class, many others are being left behind.  One of those reasons is poor education for students of color.  A report from the U.S. Education Department, the black-white student achievement gap has gotten even wider. Black students scored about 28 points behind white students on a 500-point scale on average, resulting in less black students being able to move on to four-year colleges.

Entrepreneurship has a long history of helping to raise the class status of many African Americans.  However, according to the Minority Business Development Agency, minority-owned start-ups raise less money from outside sources than White-owned businesses, making it harder for younger black innovators using self employment as a way out of the recession.

The paper says that “4.7 percent of White-owned start-ups raised external equity in their initial year, but only 3.5 percent of minority-owned start-ups did so. Combined with the lower overall capitalization of minority-owned new businesses, these different percentages meant that the average minority-owned start-up raised $2,984 in outside equity, whereas the average White-owned new businesses raised $7,607.”

When President Obama signed the $787 billion American Recovery and Reinvestment Act into law, $75 billion of which is earmarked to help American businesses create jobs supporting clean energy.  The president believes that green jobs will help build up America’s middle class again.  The stimulus plan also increased federal financing for science, engineering and technology education, which is believed to help accelerate the adoption of computerized health records and create over 200,000 jobs.

The president’s new initiatives have great potential to help mobilize the black community as a whole and especially those who have been marginalized, but if the longstanding problems in our community are not addressed correctly, the black middle class will be stifled.

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