Decades after the Civil Rights Movement, Black workers earn significantly worse than White workers. The gap is either 40% or 25% depending on whether the average or median census data is used, but the fact remains that there is a large gap. Why is this the case? Is it due to discrimination or is it because of better skills and education levels among White people?
It is commonly argued that the difference is solely due to educational levels. After all twice as many White people have a college degree and twice as many Black people drop out of high school. Perhaps differences in skill lie behind the wage gap. Or maybe they work in different jobs?
It is helpful to examine some of the studies on the subject. Recently a study by the National Bureau of Economic Research found that Black people earned 33% less on average and this dropped to 15% when education and previous earnings are taken into account. It concludes that this 15% (40% of the difference) is due to racial discrimination. It is not the only study to have found this. Researcher in Penn State University found a gap of 19%, 11% still persisted after education and skill levels were held constant. Another paper found that even after excluding effects of age, sex, education and geography, the gap of 20% dropped to only 13%. However the gap was only 10% when occupation and industry is excluded.
This raises another question. What if the gap is due to different jobs? What if jobs pay equally but races simply choose different ones? On the other hand there may be discrimination here too, as Black people may face barriers to certain occupations, consigning them to poorer paying jobs. This highlights the difficulty in measuring discrimination and which variables should be excluded.
Studies have found other examples of discrimination. For example job applicants with “White” (like Emily or Greg) names get 50% more job offers than applicants with “Black” names (like Lakisha or Jamel). Studies have found similar affects around the world (for one on Ireland click here)
All of this raises serious issues about race in America, and shines a new light on the debate over affirmative action. It is almost 60 years since Martin Luther King’s “I Have A Dream” speech in which he wished people would be judged on the content of the character not the colour of their skin. The large gap between the pay White people get and the pay Black people get (half of which is due to discrimination), shows that even today people don’t get the same pay for the same work.