Unemployment Rate Falls, African Americans Leave Labor Force

Unemployment Rate Falls, African Americans Leave Labor Force


The unemployment rate for African Americans fell to 15.9% as more African Americans continued to leave the labor force. The U.S. Department of Labor reported that 11,541,000 African Americans between the ages of 16 and 64 were not in the labor force in the month of July. This is up from 11,360,000 African Americans reported as not being in the labor force in the month of June.

The labor force is made up of individuals between the ages of 16 and 64 who are working, or if not working, are willing and able to work and are looking for a job. Individuals enter and leave the labor force based on age, retirement, or in the worse case, when they have given up on finding a job.

In July, 17,582,000 African Americans were in the labor force, while 17,733,000 African Americans between the ages of 16 and 64 in June were either working or looking for work.

Approximately 14,786,000 African Americans were employed in July, down from 14,855,000 employed in June. The unemployment rate was 16.2% in June.

Overall unemployment for the country now stands at 9.1% for the month of July, almost unchanged from the 9.2% unemployment rate in June. The economy added a total of 117,000 non-farm payroll jobs in June.

The news comes on the heels of last week’s report by the U.S. Department of Commerce that the economy grew at an annual rate of 1.3% in the second quarter of 2011. First quarter numbers were revised to show a mere annual increase of .4%.

While analysts believed that the Budget Control Act of 2011, the culmination of an agreement in Congress to cap spending and increase debt limits, would have settled or even rallied positive growth in the financial markets, the opposite occurred. Stocks fell 512 points, mostly on negative news from Europe regarding weak demand and continuing concerns about the ability of some European nations to pay off debt.

These concerns continued today as the Dow Jones Average continued to move between positive and negative territory, and has fallen for ten of the last eleven sessions.

Speaking on the economy this morning at the Navy Yards this morning, President Obama noted his concern to rebuild a sense of security for the middle class. Mr. Obama, while citing 154,000 additional private sector jobs, reiterated the need for a greater number of jobs created each month. Mr. Obama also cited 17 months in a row of job growth, but also noted that the country needs to crate a self-sustaining cycle where people are spending and the economy is growing. There is a need for more jobs created each month. The consensus is that the economy needs to add between 125,000 to 150,000 jobs per month in order to account for new entrants into the labor market.

Mr. Obama also repeated his call for extending payroll tax deductions for putting more money in the pockets of Americans.

Critics from the GOP were quick to chime in. In an interview this morning on CNBC, Carly Fiorina, former chief executive officer of Hewlett Packard, said what companies want is certainty before they start hiring. They want to know where they are we going, and where they stand in terms of demand and performance of the economy. Ms. Fiorina also noted that tax loopholes need to be closed as part of reforms to lower the deficit. In the long run innovation is the answer to job growth.

U.S. Representative Michele Bachmann, Republican of Minnesota, referred to the jobs situation report as “evidence that the President’s failed economic policies are digging us deeper into a hole.”

Fellow Minnesotan and former governor Timothy Pawlenty also slammed President Obama’s economic policies saying that, “It’s time for a new president to point us back into the right direction, and I am the only candidate who has proposed a specific economic plan that will create jobs and grow our economy.”

Former Massachusetts governor, Mitt Romney, added that, “When you see what this president has done to this economy in just three years, you know why America doesn’t want to find out what he can do in eight.”

While the GOP offered the expected criticism of Mr. Obama’s performance on the economy or recommended the usual plethora of tax cuts to small businesses, Mr. Obama’s labor secretary, Hilda Solis, reiterated the president’s call on Congress to pass legislation calling for additional infrastructure investment and the hiring of currently unemployed construction workers to carry out the building of roads, bridges, and airports.

“In addition to extending tax cuts for middle class families so they have more money to put back in our economy, Congress should pass a bipartisan infrastructure bill to help re-employ the millions of construction workers who lost their jobs in the housing collapse,” said Mrs. Solis.

With the Iowa primaries only five months away, Americans may see increased rhetoric on the economy, particularly job creation. Mr. Obama changed direction quickly from the debt ceiling debate to the economy earlier this week in remarks after passage of the Budget Control Act of 2011.

African Americans in particular may be particularly sensitive to the duration of high unemployment rates. Today’s announced unemployment rate of 15.9% is the first time since March 2011 that the rate has been below 16%.

Areas seeing gain in employment were health care, retail trade, manufacturing, and mining. Government employment, especially in state and local government saw job losses of 37,000 in July.


  1. This is going according to the plan right? The lady during the election said if she supported Obama, he would pay her for her house, her gas, etc. Isn't this what he meant – Change?