Economic context

New and Noteworthy: Research on discrimination in lending, a new equity-focused institute for direct care workers, and more

Archana Pyati February 22, 2022

Dear WorkRise community,

In honor of Black History Month, February’s New and Noteworthy column highlights new research and initiatives focused on the economic security and well-being of Black people, families, and communities. Structural racism has shaped the labor market and employment experiences of Black workers, but evidence that leads to action can help dismantle harmful policies and practices and rebuild equitable ones in their place. Below, we explore evidence that underscores the persistent nature of discrimination and occupational segregation affecting Black workers and potential solutions for advancing Black economic mobility.

Is there research we should elevate or a topic we should explore that sheds light on workers’ economic mobility? Write to us at

New Research

Small business and fiscal policy

Racial disparities in PPP lending: Two recent National Bureau of Economic Research working papers paint a fuller picture of the pandemic-era Paycheck Protection Program (PPP) and how it performed against two metrics: the experience of Black-owned businesses in securing loans and the program’s efficacy in protecting workers and jobs. The first study, produced by New York University Stern School of Business researchers, finds that Black-owned businesses borrowed from financial technology, or fintech, companies at a higher rate than from traditional banks. Black-owned businesses accounted for more than one in four PPP loans made by fintech companies.

Among traditional banks, small and midsize banks were much less likely to lend to Black-owned businesses, particularly in geographic areas where “racial animus is high” and human subjectivity played a role in lending decisions. Researchers measured racial animus by analyzing surveys, Google searches that contained racially charged language, and levels of housing segregation. The researchers also found that among small banks that automated their loan origination process, eliminating the need for face-to-face interactions, rates of lending to Black-owned businesses rose.

The second paper, written by Massachusetts Institute of Technology’s David Autor and Federal Reserve researchers, estimates only 23 to 34 percent of PPP loans went directly to paying workers who might have lost their jobs, and the rest went to business owners, creditors, and shareholders. The paper does not address racial differences explicitly but analyzes loan receipt by household income. Of the $510 billion in PPP loans made in 2020, only $13.2 billion went to households in the bottom fifth of the income distribution. Seventy-two percent of the loans went to the highest-income households. The authors recommend creating systems to better target aid to small businesses in need and strengthening policies aimed at preserving jobs, such as work-sharing and wage subsidies.

Macroeconomic policy and labor markets

Balancing inclusive employment with inflation controls: A new Becker Friedman Institute study shows that expansionary monetary policy (when the Federal Reserve lowers interest rates) combined with tight labor markets (when there are more job openings than workers to fill them) raises employment rates among Black workers, women, and workers with lower levels of education. Analyzing data from 895 local labor markets in the US from 1990 to 2019, the authors find that a one standard deviation drop in the federal funds rate in tight labor markets increased Black employment growth by .91 percentage points. The study underscores trade-offs policymakers must manage between broad-based and inclusive employment goals and measures to control inflation, such as raising interest rates.

Social determinants of work

Working, but still struggling: The labor market is bouncing back, but Black mothers are struggling to make ends meet, according to a new survey from the Institute for Women’s Policy Research. The survey, conducted in June 2021, shows more than 70 percent of young mothers with children younger than 13 were working full time or part time in paid employment. Yet economic insecurity was high, particularly among Black mothers and single mothers: 73.5 percent and 75.1 reported worrying about being unable to pay bills.

Skills and training

A reset moment for community colleges: A new report from the Community College Research Center at Teachers College, Columbia University, notes the COVID-19 pandemic severely reduced community college enrollment, particularly among Black, Latinx, and Indigenous students. But this moment also offers an opportunity to pursue more holistic reforms. The authors recommend greater public investment in community colleges and a shift away from the cafeteria college model to a “guided pathways” (PDF) framework designed to help students choose and complete programs that allow them to secure good jobs or transfer to four-year bachelor’s programs.

Career ladders in low-wage jobs: A new Health Affairs analysis finds Black women are overrepresented in low-wage, hazardous jobs in the health care sector. Researchers recommend raising wages, providing accessible career ladders to allow women in low-wage positions to advance, and addressing structural racism in the health care professions.


Centering Black workers in WIOA policy: Although Black workers are disproportionately represented among recipients of skills training and other services funded by the Workforce Innovation and Opportunity Act (WIOA), WIOA has not served them well because of its failure to acknowledge the role of systemic discrimination and occupational segregation in the labor market, explains Alex Camardelle, director of workforce policy at the Joint Center for Political and Economic Studies, in a recent webinar (PDF) with members of the Non-Degree Credentials Research Network.

WIOA’s race-neutral orientation has reproduced the economic and racial disparities that workforce development seeks to overcome, Camardelle says. He adds that for WIOA to achieve its intended purpose, it must center Black workers’ experience, acknowledge discrimination’s role in hiring and the workplace, and invest in data systems that track program-level outcomes for Black workers. Read the Joint Center’s issue brief summarizing principles for centering Black workers in WIOA policy and practice.

Events and Announcements

New equity-focused institute for direct care workers: PHI, a research and policy advocacy organization supporting the direct care workforce, recently launched the Direct Care Worker Equity Institute. Direct care workers provide health care and personal care services to older adults and people with disabilities and include nursing assistants, personal care aides, and home health aides. Most direct care workers are women, and many are people of color and immigrants. Average wages for direct care workers are below $15 per hour. PHI’s new institute will address the structural inequities, disparities, and poor job quality experienced by direct care workers by producing original research, policy resources, and equity-specific advocacy tools; designing interventions aimed at promoting equity; convening direct care workforce experts to craft equity-based policy and practice solutions; and collaborating with organizations representing people of color, women, immigrants, and LGBTQ+ communities.

New request for proposals (RFP) for research on nondegree credentials: The Non-Degree Credentials Research Network has an open RFP (PDF) for research on nondegree credential policies and practices. Applications are due April 15.

Measuring equity in community colleges and new initiative on good jobs: The US Department of Labor hosts roundtables exploring how community colleges can better measure equity in their programs and is launching a new Good Jobs initiative, a broad framework to inform workers about their rights to organize, engage employers on improving job quality, and support partnerships to improve job quality through federal grants and contracts.

Topics in the News

Second Amazon unionization drive in Bessemer: Amazon warehouse workers in Bessemer, Alabama, are voting for a second time on whether to unionize. Workers initially rejected joining the Retail, Wholesale and Department Store Union, but a federal ruling found Amazon unfairly influenced the first election and is allowing a second one. Workers will vote by mail, and their votes will be counted on March 28. Many consider the unionization drive an important chapter in the fight for racial justice and dignity because the majority of the Bessemer warehouse workforce is Black and 31 percent of Amazon’s nationwide field and customer support workers are Black.

Proposals to strengthen worker voice and representation: The Biden administration’s Taskforce on Worker Organizing and Empowerment just released a set of recommendations to promote worker organizing (PDF) and collective bargaining and increase private sector workers’ access to information about their right to join or organize a union. Meanwhile, Republicans have proposed legislation that would allow workers and their employers to create “employee involvement organizations” that are being pitched as less adversarial alternatives to traditional labor unions.

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