Half of Black workers in Minnesota have lost work during pandemic

Kimberly Jones was loving her job as a flight attendant recruiter before the coronavirus brought the airline industry to a standstill.

Savanna Thomas was weeks away from getting hired full time out of a temp job at a logistics company. And after a number of setbacks, Letajia Cutler-Cain felt she had finally found her dream job interviewing participants in medical studies.

Now they're looking for work again. While the pandemic has led to widespread job losses at levels not seen since the Great Depression, in Minnesota, it has hit Black workers the hardest.

Nearly 1 in 2 Black workers in Minnesota have applied for unemployment benefits since mid-March. For white workers, it is about 1 in 4, according to the Minnesota Department of Employment and Economic Development (DEED).

Some have returned to work as businesses have reopened, but a wide racial imbalance remains among those who are still jobless. More than one-quarter of Black workers were still making weekly unemployment claims last month compared with 9% of white workers.

"I have to get a job as soon as possible so I can keep on affording rent," said Cutler-Cain, who is taking a training course to become a coronavirus contact tracer. "I want to get back to work. That's my main goal."

The death of George Floyd has thrust Minnesota back into the national spotlight for having some of the largest racial disparities in the country in areas such as homeownership, education and poverty.

The pandemic has only exacerbated some of those inequities such as in unemployment.

Black Americans and Latinos, who are less likely to be in jobs where they can work from home, also have been contracting the coronavirus at higher rates.

In recent years, amid a growing economy and tight labor market, the state had begun to see the gap in the Black unemployment rate — which had been more than double that of white unemployment — begin to narrow.

"It is absolutely heartbreaking to see this reversed because the progress that was being made was only very partial," said Abigail Wozniak, director of the Opportunity and Inclusive Growth Institute at the Federal Reserve Bank of Minneapolis.

One of the big reasons for the unemployment disparity in Minnesota is that Black Minnesotans are more likely to be employed at hotels, restaurants, retail, health and other service-related industries that have seen the most job losses because of stay-at-home orders and other pandemic-induced slowdowns.

"They're on the front lines of some of the jobs that have been the hardest hit by the pandemic," said DEED Commissioner Steve Grove. "We're deeply concerned about it. It's stunning to believe that if you're African American right now, there's a 50% chance you've applied for unemployment insurance."

He added that there are active discussions in his department to figure out ways to make sure services are more accessible and equitable.

"We're developing a kind of equity checklist to put in front of every program we roll out at DEED, whether it's to get people jobs or help grow business investment," he said. "There's no magic bullet, but it's got to be rooted in everything you're doing."

While not to the same extent, the pandemic also has disproportionately hurt American Indian, Latino and Asian American employment in the state. Women, younger workers and those with less education have also taken a bigger hit.

"Black people are taking the brunt of this," said Steven Belton, president of the Urban League Twin Cities. "It's very alarming to us, but not surprising. If it follows historic trends, the bounceback will be slower in the communities we serve. We're the first to be fired. We're also the last to be rehired."

Racism can seep in when employers are making these decisions, he said.

While frustrating to see, the racial disparity in layoffs and hiring is something that happens every time there is a recession, said Tawanna Black, CEO of the two-year-old Twin Cities-based Center for Economic Inclusion. It's added proof, she said, that the gains made in the last few years were not as meaningful as they could have been.

"Of course these are the individuals that are going to be left out when we've connected African Americans to those low-wage jobs — our retail sector, our services sector — as opposed to creating real economic opportunity across the entire spectrum such as that we would not expect to see such a disparate impact when we have these economic shocks," she said.

Minnesota's unemployment rate fell to 8.6% in June, down from a 9.9% record high in May. While some had initially hoped for a quicker rebound, many projections are now calling for an elevated jobless rate over a longer period of time.

A forecast by IHS Markit suggests that Minnesota's unemployment rate will improve in the coming months but will not likely return to pre-pandemic levels for at least a couple of years.

As the economy does recover, it may not return to the previous structure and some jobs may end up being permanently displaced. Judging by historic patterns, that shift will likely disproportionately affect workers of color, said Wozniak of the Minneapolis Fed.

"They are going to need to make some kind of transition to find new employment, which is going to take awhile," she said. "Those are the things that are going to feed into that longer-term widening of gaps we're starting to see right now."

Federal stimulus checks and other enhanced jobless benefits have helped cushion the blow until now for many who are out of work. While they will continue to receive regular unemployment benefits, the additional $600 a week from the federal CARES Act is set to expire this week. That fiscal cliff is expected to send an influx of unemployed workers to already busy food shelves.

"That was what was really keeping the boat afloat," Sharon Record, a 20-year-old Brooklyn Park resident, said of the extra $600 a week.

Whatever has been left over after paying the rent, car insurance and groceries, she's put toward paying for community college classes in the fall. In the meantime, she has been on the job hunt for weeks.

"Wherever I see a hiring sign, I've tried to apply," she said, listing off grocery stores, fast-food chains, car dealerships and a bank.

She's gotten only one callback so far, for a job as a bank teller. She had a second interview on Friday.

Many workforce training and job placement programs have been hustling to shift their services online during the pandemic. They're now hosting job fairs over Zoom and are rolling out digital training courses. But they've also been mindful that not all people have access to computers and Wi-Fi.

Twin Cities Rise, a job training program that works mostly with people of color, received a grant from the state so it could provide Chromebooks to participants of its courses, which are now all online. Melanie Williams, the program director, is expecting to see a big uptick in people seeking its services in the next couple of weeks as the enhanced federal benefits run out.

"It's the calm before the storm," she said.

Hilary Thomas, a job counselor with the Urban League, said many people are in a holding pattern right now waiting to see if they're going to get called back to their jobs.

"People are trying to stay above water, but there's a lot of frustration," he said. "So many things they had been building toward got yanked out from under them. Many of them will have to start from square one again."