Ultimate magazine theme for WordPress.

Racial inequality costs the US economy trillions, researchers find

A boardroom can be seen in an office building in Manhattan, New York City, New York, USA, May 24, 2021. REUTERS / Andrew Kelly

Sept. 8 (Reuters) – Racial and ethnic inequalities have cost the US economy around $ 51 trillion in lost production since 1990, San Francisco Federal Reserve President Mary Daly said on Wednesday, citing data a paper she and three co-authors will present at The Brookings Institution.

Large and persistent disparities in employment, education and income rates between the races “combined into a smaller economic pie for the nation as a whole,” Daly said in a briefing ahead of the paper’s release Thursday.

“The imperative of justice to fill some of these loopholes is not only moral but also economic.”

The paper outlines what GDP would have been if there had been no gaps in the labor market.

For example, the employment of black men is consistently lower than that of men of other races.

Reuters graphic

The incomes of black and Hispanic workers also lag behind those of whites.

Reuters graphic

Daly and her co-authors calculated what GDP profit would be if these and other racial gaps were eliminated: If black and Hispanic men and women worked the same quotas as whites, if they graduated from college at the same quotas would like whites, and if they deserved the same as whites.

Just from work, they calculated, profits would add up to $ 22.9 trillion in the thirty years from 1990 to 2019, with larger profits in recent years as the proportion of the non-white population increased while the Gaps have remained pretty constant.

The larger estimate of $ 51.2 trillion takes into account the surge in capital investment that a more productive workforce could likely trigger, Daly said, and comes in at $ 2.57 trillion in 2019 alone.

The paper was co-authored with Shelby Buckman, a PhD student at Stanford University, Lily Seitelman of Boston University, and Laura Choi, vice president of community development at the San Francisco Fed.

Reporting by Ann Saphir; Arrangement by Richard Pullin

Our Standards: The Thomson Reuters Trust Principles.

Comments are closed.