November 8th 2023.
The Great Recession of 2007 had a devastating effect on generations of Black women, particularly in terms of home equity. Even though the economy has been recovering since then, research studies have found that Black women are behind the rest of the population and are not able to recover their losses.
In the 1990s, single Black women were emerging as a group of homebuyers and were outpacing the growth of single white women and men for a few years to come. But then the Great Recession hit, and Black women were the hardest hit. They saw a 38% reduction in their wealth, compared to only 10% for white women. To make matters worse, 13% of Black women were unemployed, making them more vulnerable to the economic downturn.
Research has shown that Black women headed by college graduates have less wealth than white households headed by high school dropouts. This is due to a variety of factors, such as racially motivated subprime targeting, larger down payments, higher cost mortgages and foreclosures, and discrimination. Black women are getting 64.1% of bachelor’s degrees, 71.5% of master’s degrees, and 65.9% of doctoral, medical, and dental degrees. However, they continue to experience significant disparities when compared to their white counterparts in terms of unemployment, wages, access to key work-family supports, and in advancement opportunities.
The COVID-19 pandemic has only amplified the financial precarity that Black women face. The unemployment rate for Black women is twice that of white women. They are also more likely to work in jobs that do not offer benefits like health insurance, retirement benefits, paid sick days, paid family or medical leave, or paid vacation time. Furthermore, they are typically paid only 67 cents for every dollar spent by white men, meaning they need to work an additional 208 days to catch up to the earnings of white men.
On top of this, Black women were disproportionately affected by subprime lending during the boom. They were 2.8 times more likely to be denied a loan than white applicants, and when they were approved, they were 2.4 times more likely to receive a subprime loan than white applicants. This led to more foreclosures and segregation among Black families.
Today, Black women are still spending more than 30% of their income on housing. This is a clear indication that the racial disparities in homeownership and employment continue to prevent them from taking advantage of an economic recovery. Until these disparities are addressed, Black women will remain at a disadvantage.
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