The fact that black workers earn less is a problem in part because it limits their chances at moving up the income ladder. Lower wages can make it harder to afford time off for education and training, for instance.
And it’s particularly worrying that the black-white gap is climbing on the back on unexplainable factors. While a sizable portion of the racial wage divide arises from the different industries and occupations black people work in, their education levels, and their ages, the share owing to factors that aren’t traceable accounts for much of the growth in the wage gap over time.
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 authors write.
This article was provided by Bloomberg News.