Are American minorities unduly optimistic about their economic condition and future? A nationwide survey of attitudes about the recession and its impact shows that blacks and Hispanics, although hit harder by the economic downturn, are more upbeat than white Americans about the economy and the future of the United States.
Blacks and Hispanics are also more optimistic about an economic turnaround than whites. Among blacks, 32 percent said the economy is recovering, while only 19 percent of whites and 13 percent of Hispanics agreed that the situation was improving.
The responses came from a recent nationwide survey of 1,959 adults that captured minority and white attitudes on topics including financial condition, homeownership, the state of the economy and the prospects for their children. The survey was conducted by the Washington Post, the Kaiser Family Foundation and Harvard University. The Post shared the survey data with The Root.
The overall financial condition of U.S. minorities is worse than that of whites, and the gap has widened during the four-year recession. In January 2011, the unemployment rate for blacks was 15.7 percent and 11.9 percent for Hispanics. The white unemployment rate was 8 percent. Among black teens, 45 percent were jobless, and the ripple effect of unemployment and underemployment scars all minority communities.
Yet 24 percent of Hispanics and blacks surveyed said that they were very or somewhat satisfied with the nation's economic situation, compared with just 12 percent of whites — although few minorities work in recession-resistant sectors, and most labor in low-wage, low-skill manual or service jobs.
Perhaps these respondents, attuned to the slightest economic tremors, sense that a recessionary bottom had been reached and a rebound is beginning. Since the Great Recession began in 2007, firms have shed workers, sent work overseas, tamed unions and slashed benefits. The result: golden 2010 profits, higher stock prices and a slight rise in consumer spending.
Minorities understand well the "last in, first out" mentality of business. Comedian and social commentator Dick Gregory wrote in his 1962 book, From the Back of the Bus, "My people have never known what job security is. For instance, come another recession, and the economy has to tighten its belt — who do you think's gonna be the first notch?"
While minorities leaned distinctly toward the positive in their survey responses, the majority of all three groups agreed that they were unhappy with the economy. For example, 86 percent of white workers were somewhat or very dissatisfied with the economic situation, versus 72 percent of black workers and 75 percent of Hispanics. White pessimism may have been exacerbated by the fact that the ax fell harder on this group than it has in the past, when layoffs affected whites much less than they did blacks or Hispanics.
Attitudes also diverged by race when survey respondents were asked about their own financial situation. Sixty percent of whites — who on average own more securities, property and insurance than minorities — were very or somewhat satisfied with their finances. Yet at least 30 percent of whites, perhaps affected by job loss, fallen stocks or high mortgage payments, were somewhat or very dissatisfied about their financial condition.
By contrast, most minority workers have very little financial cushion. Only 47 percent of Hispanics and 51 percent of blacks were very or somewhat satisfied with their financial condition. Instead, nearly half of blacks and Hispanics surveyed were not satisfied.
United for a Fair Economy, a liberal think tank, reports that for every dollar a white family earns in income, black and Hispanics take home only 57 and 59 cents, respectively. The discrepancy savages their net wealth, which is calculated by adding up the total value of one's investments, savings, homes and other property and then subtracting any debt. Blacks and Hispanics retain 10 and 12 cents of net worth, respectively, compared with every dollar held on to by white families.
Slightly more than half of whites surveyed, 53 percent, thought the nation has peaked in providing "good jobs for American workers." Their answers to the survey also blamed government in Washington, Wall Street financial institutions and spendthrift consumers "for the economic challenges facing this country today."
Minority opinion on job creation diverged from that of whites. Some 52 percent of Hispanics, who can be of any race, agreed that U.S. job creativity has peaked. Among blacks, just 35 percent agreed with the statement. But Hispanics put less blame on government or on financial institutions for the nation's economic challenges than blacks did. Instead, Hispanics blamed profligate consumers.
Blacks were less likely than whites (73 percent versus 89 percent), but more likely than Hispanics (71 percent), to blame government, which employs many African Americans and has supported civil rights causes. Blacks also didn't completely buy the idea that Wall Street is to blame (68 percent, versus 78 percent for whites and 64 percent for Hispanics). As for consumer spending, while nearly two-thirds of blacks thought it was a problem, they were less likely than whites and Hispanics (82 percent and 74 percent, respectively) to see it as a large issue.
Looking toward the future, blacks showed remarkable optimism. In the survey, more whites (37 percent) and Hispanics (24 percent) than blacks (18 percent) said that the changes they had made in their lifestyle because of the recession would be permanent. Blacks also were more likely (62 percent) than Hispanics (51 percent) or whites (36 percent) to believe that their family's financial situation would improve.
Who participated in the survey? The poorest whites, 13 percent, had a total annual household income before taxes of less than $20,000. In this lowest-income group, 24 percent were black and 31 percent Hispanic. In the middle class, 17 percent of whites earned $65,000 to $99,000 annually. Eleven percent of blacks and 7 percent of Hispanics were in that category. In the $100,000-and-above bracket, whites constituted 19 percent; blacks, 12 percent; and Hispanics, 6 percent. A majority of those surveyed were between 30 and 64 years of age, and slightly more than half of the respondents were women.
Less than 13 percent of those surveyed were union members. Twenty percent went to church weekly. Of college graduates, 18 percent were white, 10 percent black and 8 percent Hispanic. Whites, at 79 percent, were the greatest percentage of homeowners, and 29 percent had paid off their mortgages. Fifty percent of blacks and Hispanics owned homes, but only 14 percent and 17 percent, respectively, owned their dwellings outright.
While Dick Gregory still appears to be correct when it comes to predicting layoffs, the broad fallout of the Great Recession may have frightened white workers in a way that their Great Depression-era grandparents would have understood. When many domestic and global sectors suffer reversals, the scythe of job destruction draws blood in all communities.
Read the Washington Post article on the survey here.
Frank McCoy is a frequent contributor to The Root.