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WHAT’S BEHIND RISING UNEMPLOYMENT FOR BLACK WORKERS?  
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Valerie Wilson
September 19, 2025
Economic Policy Institute
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_ There has been a clear deterioration in the labor market for Black
workers this year. The decline in Black workers’ employment appears
to be concentrated among Black women. _

Black women’s employment has fallen since 2024, but the sharpest
declines have come in 2025, Economic Policy Institute

 

For the last five years, I’ve given the same answer in response to
questions about any one-month increase in the Black unemployment rate.
Given the relatively small sample size used to calculate the number
each month, we shouldn’t make too much of a single month’s
increase but focus on longer-term patterns and see if the upward trend
continues over the next few months. Well, as of August 2025, the Black
unemployment rate has risen for three consecutive months and now
stands at 7.5%. This post details three major conclusions I have drawn
from this and supporting data:

* There has been a clear deterioration in the labor market for Black
workers this year: the unemployment rate is rising and employment is
falling.
* The decline in Black workers’ employment appears to be
concentrated among Black women while Black men’s employment rates
appear more stable.
* Since January 2025, overall women’s employment has fallen most
in professional and business services, manufacturing, and federal
government—suggesting likely culprits for the decline in Black
women’s employment.

An important signal that the rising Black unemployment rate may
actually be more than a temporary blip in a notably volatile data
series is that the share of employed Black adults between the ages of
25 and 54 is down compared to the last couple of years
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peaking at a historic annual high of 77.9% in 2024, the average so far
this year is 76.6%. Until now, the rate had risen every year since
2021.

Another developing news story that has garnered increasing attention
is the reported
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Black women losing jobs and/or leaving the labor force in recent
months. While a number that big certainly makes headlines, employment
levels from the monthly household survey—especially those based on a
small demographic slice of the monthly survey sample—should always
be used with caution. While I’m not convinced that 300,000 is the
most accurate accounting of the situation, Black women are uniquely
experiencing a decline in employment that is not observed among other
groups of women or Black men.

A clearer and more reliable indicator of how Black women are doing in
the labor market is their employment-to-population ratio (EPOP).
As FIGURE A shows, Black women’s employment has dropped sharply
this year, but there has been a longer downward trend that started in
early 2024. This stands in stark contrast to the trend for white women
whose EPOP has changed little over the same time while Hispanic women
have seen a slight increase.

Similarly, FIGURE B shows that the EPOP for Black men in the same
age group has been much more stable over the last three years. Since
the decline for Black women is not reflected in other group trends by
gender or race alone, there appears to be something happening in the
labor market that has been particularly damaging to Black women.
Below, I explore possible explanations based on analysis of payroll
employment data.

The 2020 pandemic recession showed how occupational segregation can
contribute to a larger decline in employment among groups
overrepresented in industries with the largest job losses. While the
Bureau of Labor Statistics does not report industry-specific job
losses by race and gender, they do produce a series on women’s
payroll employment using data collected in the monthly establishment
survey. And although the data from the household and establishment
surveys are not directly comparable, checking for similar or related
trends can be informative. With those caveats in mind, FIGURE
C shows that women’s payroll employment has declined in eight
industries between January and August of this year. The largest of
those losses have occurred in professional and business services
(–83,000), manufacturing (–41,000), and federal government
(–33,000). Close to half of all workers in federal government and
professional and business services are women, as are 29% of
manufacturing workers (see TABLE 1).

Since federal job cuts have frequently been cited as a contributing
factor for employment losses of Black women
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to overrepresentation in that sector relative to their share of the
total workforce
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let’s start there. Table 1 shows that the year-over-year rate of
decline in payroll employment of all women in federal government
(–1.2%) was slower than the rate of decline in total employment
(–2.4%) in that sector. This suggests that women aren’t losing
jobs faster than men in the federal sector, but without additional
information, we can’t rule out the idea that women’s federal
losses are disproportionately falling on Black women.

The second-largest number of women’s job losses has been in
manufacturing. As Table 1 shows, women are a smaller share of total
employment in this industry compared with the federal government or
professional and business services. However, unlike in the federal
government, women have lost manufacturing jobs at a faster than
average rate over the past year.

The largest number of women’s job losses has been in the
professional and business services industry, which employs seven times
more women than the federal government. As such, a higher rate of
women’s job losses in this industry would be more likely to show up
in declining EPOPs for Black women. Compared with the total
year-over-year rate of job losses in the industry (–0.3%), women
have lost jobs at a much faster pace (–1.3%).

As shown in Table 1, a closer look into the rate of employment decline
in professional and business services shows that losses have been
overwhelmingly concentrated in employment services—a decline of 3.2%
between July 2024 and July 2025. Similarly, women’s losses within
professional and business services were also skewed toward employment
services.

Employment services accounts for roughly 15% of total employment
within the professional and business services major industry. Women
are nearly half (47.9%) of employment services workers and the most
common occupation is human resource worker. This suggests the shedding
of employment services jobs as a likely culprit behind large job
losses among women in the industry. Again, additional information
would be required to definitively conclude that those job losses are
disproportionately falling on Black women. Well-documented patterns
of occupational segregation
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limit the representation of Black women in higher-level and
higher-paying professional and management positions, resulting in
overconcentration in service, administrative, and support occupations.
Thus, it would not be a huge leap to assume that women’s job losses
skewed toward employment services, over one of the subsectors
beginning with “professional, scientific, and technical” or
“management”, are probably having a negative impact on Black
women’s employment.

_VALERIE RAWLSTON WILSON (she/her) is a labor economist and Director
of the Economic Policy Institute’s Program on Race, Ethnicity, and
the Economy (PREE), a nationally recognized source for expert reports
and policy analyses on the economic condition of America’s people of
color. As PREE Director, Wilson has worked to elevate EPI’s thought
leadership on issues of racial and economic justice and expand
PREE’s capacity to prescribe policy solutions that center racial
equity. Prior to joining EPI, Wilson served as Vice President of
Research at the National Urban League, where she played a pivotal role
in the production of the organization’s annual signature
publication, The State of Black America, and assisting the historic
civil rights organization in shaping its national economic policy.  
In 2022, she was President of the National Economics Association, an
organization founded to promote the professional lives of black
economists while expanding knowledge of economic issues of particular
interest to communities of color. In 2023, she was elected to become
a fellow of the National Academy of Public Administration.  _

_Throughout her career, Wilson has written extensively on various
issues impacting racial economic inequality in the United
States—including employment, wage, income and wealth
disparities—and has also appeared in major print, television, and
radio media.  Wilson has testified before Congress on racial
disparities in unemployment and earnings and was keynote speaker for
the regional Federal Reserve Banks’ series on Racism and the
Economy: Focus on Employment.  She has twice served on National
Academies panels charged with proposing ways to improve the EEOC’s
ability to measure and collect pay information from U.S. employers in
support of the agency’s responsibility to investigate charges of pay
discrimination. In 2010, through the State Department’s Bureau of
International Information Programs, she was selected to deliver the
keynote address at an event on Minority Economic Empowerment at the
Nobel Peace Center in Oslo, Norway._

_The ECONOMIC POLICY INSTITUTE’s vision is an economy that is just
and strong, sustainable, and equitable — where every job is good,
every worker can join a union, and every family and community can
thrive._

_About EPI. The Economic Policy Institute (EPI) is a nonprofit,
nonpartisan think tank working for the last 30 years to counter rising
inequality, low wages and weak benefits for working people, slower
economic growth, unacceptable employment conditions, and a widening
racial wage gap. We intentionally center low- and middle-income
working families in economic policy discussions at the federal, state,
and local levels as we fight for a world where every worker has access
to a good job with fair pay, affordable health care, retirement
security, and a union._

_We also know that research on its own is not enough—that’s why we
intentionally pair our research with effective outreach and advocacy
efforts as we fight to make concrete change in everyday people’s
lives._

_Donate to the Economic Policy Institute
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* Black Women
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* unemployment
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* Professional and business services
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* workforce
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