Race wage gap widens

Black workers earn less than their white counterparts in a worsening trend that holds even after accounting for differences in age, education, job type and geography, new Federal Reserve research shows.

In 1979, the average black man in America earned 80 percent as much per hour as the average white man. By 2016, that shortfall had worsened to 70 percent, according to research released Tuesday by the Fed's San Francisco district, which found the divide had also widened for black women.

The new research highlights the persistence of a racial wage gap 50 years after the passage of the Civil Rights Act.

The fact that the gap has lingered and even worsened over time also means that a stronger labor market, which politicians often cite as a remedy for black workers' economic disadvantage, probably won't permanently narrow the divide, officials said.

"A job is the first condition, but it's really not a sufficient condition to fix disparities," San Francisco Fed research director Mary Daly said.

Black workers consistently have a higher unemployment rate than their white counterparts, but that divide is highly cyclical: In strong labor markets, it shrinks, but it skyrockets again during recessions. Black wage gaps change less across business cycles.

Earning less can also limit black workers' chances of eventually moving up the income ladder. Lower wages can make it harder to afford time off for education and training, for instance.

In 1979, about 8 percentage points of the earnings gap for men was hard to explain, and by 2016, that had risen to 13 percentage points -- just under half of the total earnings gap.

"This implies that factors that are harder to measure -- such as discrimination, differences in school quality, or differences in career opportunities -- are likely to be playing a role in the persistence and widening of these gaps over time," the study authors write.