US Workforce System Limits Opportunities Due to Racial Discrimination, Report Finds

By Allende Miglietta

A recent report from the Joint Center for Political and Economic Studies has revealed that the U.S. public workforce system may be contributing to ongoing racial disparities in employment among Black Americans.

The report indicates that the workforce system exacerbates these inequalities by directing Black workers toward low-wage jobs that offer little opportunity for career advancement and economic mobility.

One potential solution identified in the analysis is the establishment of “sector partnerships.” These partnerships involve collaboration between employers in a specific industry, as well as educational institutions, community organizations, and labor unions, aimed at enhancing workers’ skills and connecting them with job opportunities. According to Justin Nalley, a senior policy analyst at the Joint Center, this model has demonstrated effectiveness in increasing pay and job retention for Black workers.

The Workforce Innovation and Opportunity Act (WIOA), enacted in July 2014, mandates that local and state workforce boards gather and analyze labor market data to create "sector initiatives" for industries with high demand for workers. However, the Joint Center has pointed out that there is a lack of federal data showing the outcomes for Black Americans participating in work programs. This gap exists because reporting racial demographics is not mandated at the state level. Currently, Black Americans make up approximately 13% of the workforce, according to government statistics.

The Department of Labor has not provided immediate feedback regarding these findings. It is also important to note that sector partnerships are not financially supported under WIOA. While it is required that workforce boards include these partnerships in their strategic plans, there is no associated funding, as pointed out by Nalley, who also noted that discriminatory hiring practices further impede progress.

Algernon Austin, director of the Center for Economic and Policy Research, emphasized that federal and state agencies responsible for enforcing anti-discrimination policies, such as the Equal Employment Opportunity Commission (EEOC), are underfunded. He remarked, “Our ability to identify and counteract discrimination in the labor market has been systematically weakened over time,” highlighting the accountability gaps present due to insufficient funding for enforcement.

The EEOC stated that, despite some efficiencies implemented, it has managed to recover significantly more in monetary benefits for discrimination victims than its budget allows, amounting to $665 million in the fiscal year 2023 alone.

In April, the U.S. House of Representatives passed a bipartisan bill aimed at reforming the WIOA, called the A Stronger Workforce for America Act. Its objective is to enhance skills development for workers.

The Joint Center noted that training programs eligible under WIOA typically prepare Black workers for lower-tier jobs, where they would earn less than $40,000 per year on average. A study by the Department of Labor in 2021 highlighted the wage disparities faced by Black workers in training programs, revealing that they earned between $2.46 and $15.50 less per hour than their white counterparts in the fields of transportation, production, healthcare, and agriculture. Over a decade in the workforce, wages for white workers were found to grow approximately 28% faster than those of Black workers.

The Joint Center advocates for the inclusion of more “race accountability data metrics” in the Senate version of the legislation, which is still pending.

Democratic Representative Bobby Scott, who introduced the bill alongside Republican Representative Virginia Foxx, stated, “The availability of getting the skills you need to make higher salaries, a lot of those opportunities have been restricted just by discrimination.”