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UW-Milwaukee - Center for Economic Development

Policy Research Report Abstract

The Crisis of Black Male Joblessness in Milwaukee: Trends, Explanations, and Policy Options, March 2007, by Marc V. Levine

Executive Summary

There is no greater economic challenge facing Milwaukee than the crisis of joblessness among black males in the city. This study presents the most up-to-date analysis available of recent trends, examining racial disparities in the city and regional labor markets, and placing Milwaukee's record in comparative and historical context. Our chief finding is that Milwaukee's 30-year trend of near-linear growth in black male joblessness peaked in the city in 2003 at 51.3 percent and declined to 44.1 percent by 2005. In addition, by 2005, racial disparities narrowed somewhat in the city and region, and Milwaukee's black-white employment gap moved closer to the average of other Northeast-Midwest cities and metropolitan areas. Nevertheless, the black male jobless rate remains unacceptably high in Milwaukee, with black male joblessness here ranking second highest among comparable Northeast-Midwest metropolitan areas in 2005. Civic leadership in Milwaukee, we contend, continues to lack the vision, policies, and institutions to comprehensively attack and meaningfully alleviate the crisis of race and jobs in the city and region.

This report contains three main sections. First, we present the most current data on trends in black male joblessness and racial disparities in employment, for Milwaukee as well as a pool of "benchmark" cities and regions. Second, we analyze how the confluence of three key factors--suburbanization, hyper-segregation, and deindustrialization--has shaped the particularly sharp racial disparities in the Milwaukee labor market. Finally, we examine the shortcomings of existing policies and strategies and identify some promising alternative policy options.

Our key findings:

I. Race and Male Joblessness in Milwaukee: 2005

The jobless rate for working-age black males (ages 16-64) in metropolitan Milwaukee region stood at 43.1 percent in 2005, a small decline from 46.5 percent in 2002. White male joblessness increased slightly between 2002-2005 in metro Milwaukee and thus, combined with the decline in black male joblessness during this period, the region's racial gap in joblessness shrank by almost five percentage points.

A huge racial gap in male joblessness exists in all age categories in metro Milwaukee, from teenage workers to prime working-age adults. Black male joblessness not only exceeds the white rate by at least 20 percentage points in all age groupings, but the jobless rate among black males also is significantly higher than for Hispanic males in metro Milwaukee, particularly among younger workers.

Table 1:
Male Joblessness in Metropolitan Milwaukee, 2002-2005
(percentage of working-age males unemployed or not in the labor force)
Year Black White Hispanic
2002
46.5%
18.7%
25.6%
2005
43.1%
20.1%
29.3%

There is a sharp regional/racial polarization of Milwaukee's male labor market, with the largest gaps in jobless rates separating white suburbanites from black residents of the central city. For example, among prime working-age males (ages 25-54), the jobless rate for white suburbanites in 2005 was 11.8 percent, compared to 34.6 percent black males living in the city of Milwaukee.

II. Race and Joblessness in Milwaukee: A Comparative Perspective, 2002-2005

Despite modest improvements between 2002-2005, the rate of black male joblessness in the Milwaukee region remains near the highest of Northeast-Midwest metropolitan areas, and in 2005 the racial gap in male joblessness was, with the exception of metro Pittsburgh, the widest among "Frostbelt" metropolitan areas.

In 2002, Milwaukee registered the highest working-age black male jobless rate among the 15 "Frostbelt" metropolitan areas against which we benchmarked Milwaukee's performance; in 2005, Milwaukee recorded the second highest black male jobless rate among these regions. The gap in Milwaukee separating white and black rates of male joblessness, which was 27.8 percentage points in 2002, the highest in the Frostbelt in 2002, declined to 23.0 points in 2005, which nevertheless placed Milwaukee second worst among our benchmark regions.

Milwaukee's ranking on these indicators is somewhat better when comparisons are at the city level, but city-to-city comparisons are somewhat misleading, because in metro Milwaukee, unlike elsewhere in the Frostbelt, there has been virtually no suburbanization of the working-age black male population.

Table 2:
Black Male Jobless Rates in Selected Metropolitan Areas: 2002-2005
(percentage of working-age (16-64) black males either
unemployed or out of the labor force)
2002 2005
Baltimore
N/A
Boston
28.3%
Minneapolis
N/A
Baltimore
31.6%
Cincinnati
N/A
Indianapolis
34.4%
Indianapolis
30.8%
Kansas City
34.9%
Pittsburgh
31.9%
Minneapolis
35.9%
Cleveland
32.3%
Cincinnati
36.3%
Boston
36.4%
Philadelphia
39.7%
Detroit
39.0%
St. Louis
40.1%
Kansas City
39.1%
Buffalo
40.4%
Philadelphia
39.7%
Chicago
42.1%
Chicago
41.1%
Detroit
42.7%
St. Louis
42.8%
Cleveland
42.7%
Buffalo
45.7%
Milwaukee
43.1%
Milwaukee
46.5%
Pittsburgh
48.3%
Average
38.7%
Average
39.1%

 

III. Black Male Joblessness in Milwaukee, 1970-2005: Historical Development and Explanatory Factors

The rise in joblessness among working-age black males in Milwaukee during the past 35 years has been relentless, increasing substantially at each census measurement until reaching a staggering 51.5 percent in 2003 (before improving to 44.1 percent by 2005).

Perhaps even more striking has been the growth in joblessness among prime working-age black males in Milwaukee since 1970. Joblessness among males between the ages of 25-54 is particularly revealing of the state of the local labor market; we're much less likely to see, in this age group, potential workers voluntarily absent from the labor market because of schooling, retirement, or homemaking.

The jobless rate for prime working-age black males was 15.2 percent in 1970, relatively modest by historical standards, albeit double the rate for white city residents and almost quadruple the rate for white suburbanites. However, as has been the case for all working-age black males, joblessness among prime-working age black males has grown ceaselessly in Milwaukee since 1970, peaking at an astonishing 40.8 percent in 2003, before improving to 34.6 percent by 2005.

Three key factors underlie the crisis of black male joblessness in Milwaukee:

  • Deindustrialization: Manufacturing was a critical source of jobs for Milwaukee's black males through the 1970s, and, to a greater degree than almost anywhere else in the Frostbelt, industrial decline fundamentally diminished black male employment opportunities in the city;
  • Suburbanization of Jobs: Since 1980, all of the net job growth in metro Milwaukee has been in the suburbs, with the largest increases in the exurban counties (up 81 percent). The city of Milwaukee has lost almost 18 percent of its job base since 1980.
  • Racial Segregation: The suburbanization of jobs in metropolitan Milwaukee, especially in manufacturing, has combined with the region's entrenched residential segregation to produce a "spatial mismatch" in the regional labor market. This mismatch has severely limited employment possibilities for the region's black males. The overwhelming majority (92%) of the region's working-age black males live in a city with an eroding employment base, while all of the net job growth in the region is occurring in exurban areas where few blacks live and to which city-based minority workers have minimal transportation access. Through 2000, just over 8,500 black workers in metropolitan Milwaukee--only 11 percent of all black workers in the region--had secured employment in the exurban counties, representing a tiny fraction of the exurban workforce. By contrast, 43.1 percent of the region's white workers were employed in the exurban counties in 2000.

Two other factors--disparities in educational attainment as well as the age structure of Milwaukee's black male community--also help explain both racial differences in male joblessness in Milwaukee, as well as why the employment picture for black males is especially dismal here compared to other cities and regions.

There is a substantial racial gap in male educational attainment in Milwaukee; in the metropolitan area, for example, white males are almost three times as likely as black males to hold college, professional, or advanced degrees, a disparity that mirrors the racial disparity in male joblessness.

Milwaukee's working-age black male population is, on average, younger and less educated than counterparts elsewhere in the Frostbelt; since joblessness rates are higher among the young and less educated, this demographic factor also helps explain Milwaukee's high rate of black male joblessness.

IV. Local Policy and the Crisis of Black Male Joblessness in Milwaukee

Milwaukee Mayor Tom Barrett and the region's corporate leadership in the GMC and MMAC appear to have settled into a three-pronged "jobs strategy" to combat predominantly minority inner city joblessness: workforce development, minority entrepreneurship, and regionalism. All are worthy policy objectives and, in principle, can contribute to improving the local labor market. All, however, are deeply flawed as cornerstones of a local jobs strategy; in particular, without other more direct job creation policies ("demand-side"), these ('supply side") approaches are unlikely to have a significant impact on the crisis of black male joblessness in Milwaukee.

  • Milwaukee's recent history, as is the case nationwide, is littered with disappointing results from job training programs. Workforce development is predicated on the fallacious assumptions that enough jobs exist for properly trained workers, or that with adequate training enough private-sector jobs will be created for all workers. In fact, in 2005, by conservative estimate, there were 88,294 more jobless than available jobs in metro Milwaukee; there were six jobless Milwaukeeans for every available job in 2005; there were an astounding nine jobless for every available full-time job. The primary need in Milwaukee is not improved job training, but rather policies that increase the demand for low- to moderate-skilled labor and attack the critical shortage of available jobs in the region.
  • Minority entrepreneurship offers little prospect of improving the employment picture for working-age black males. In the 50 largest metro areas in the country, there is no evidence that high rates of black business ownership produce low rates of black joblessness. Black-owned businesses employ a tiny fraction of workers (less than one percent in Milwaukee), so even huge growth in black-owned businesses would have a trivial impact on the black jobless rate.
  • M-7 "regionalism" could contribute significantly to alleviating the crisis of black male joblessness. But, so far, the M-7 seems focused on branding and marketing Milwaukee and pursuing what one researcher has dubbed the "job training charade," rather than the kinds of meaningful regional "equity" polices in transportation, public finance and housing that could make a difference in combating minority joblessness.
V. Policy Options: New Directions to Combat Black Male Joblessness in Milwaukee

This study has identified three strategies that offer far greater likelihood of reducing black male joblessness in Milwaukee than current approaches:

  • Public infrastructure investment, which will not only meet pressing needs in a community with aging infrastructure, but could also play a critical role in boosting, Keynesian-style, local demand for low- to moderate-skilled labor. Particularly if accompanied by explicit minority-hiring goals or low-income resident preferential hiring programs, public investments could be a central element in a real Milwaukee "jobs strategy." The examples of the Marquette Interchange project and the city of Milwaukee's "Residents Preference Program" (RPP) show the promise of this "demand-side" approach to the labor market.

    In particular, this study recommends that Milwaukee leaders vigorously pursue development of a jobs-producing, competitiveness-enhancing regional light rail transit system. In its political resistance to light rail, Milwaukee is increasingly isolated among U.S. cities; and, the more Milwaukee remains immobilized on this issue, the more the region risks falling further behind our competitors economically, and the more we lose the opportunity for a "big bang" investment that could ameliorate the labor market for low- to moderate-skilled workers.
  • The RPP and Marquette Interchange projects show that targeted hiring standards attached to local investments can improve the employment prospects for minorities and the disadvantaged. Milwaukee should follow the example of a growing number of cities around the country and attach "community benefits agreements" (CBAs) to major redevelopment projects, to give preferential hiring to inner city residents and minorities, and to require developers receiving public subsidies to meet job creation and wage standards. Moreover, all developers doing business in Milwaukee should be encouraged to meet these standards.
  • A critical element of a jobs strategy in Milwaukee must involve opening up the suburban labor markets of the region to racial diversity. "Opening up the suburbs" might include several policy options, but the two most important are transportation and housing. Regional transportation policies must be realigned to facilitate the access of central city workers to suburban employment centers; and building affordable housing in the suburbs is essential, so that low-to-moderate-skilled workers, with limited incomes, can live in greater proximity to the location of 90 percent of the region's entry-level job openings.

 

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