What will the shrinking of the public sector mean for the economic prospects of African-Americans?
The public sector is one of the most important sources of employment for black workers (21 percent of whom are public employees), and the belt-tightening by cities and states threatens to have a disproportionate impact on blacks. Whats more, the constriction of government work is happening in a period when black male employment is, depressingly, at a record low.
Mayors and governors are trying to reduce worker compensation costs because they consume on average 70 percent to 80 percent of cities and 30 percent of the states budgets. Looking ahead, there will be slightly fewer jobs in the public sector and they will be less well paid. Nonetheless, public employment will remain a significant source of stable jobs for black Americans.
More interesting is the fact that many young and talented blacks are fleeing the places where public employment has been expansive and government unions strong. College-educated blacks have been leading a “new great migration” from states like Michigan, Illinois and New York to the right-to-work states of the South.
People move for complex reasons, but part of the issue is that unionized government is correlated with higher taxes, less flexible government and policies that constrict private sector job growth. Judging by the evidence of blacks voting with their feet, better job opportunities appear to be found in places where government unions are limited, public administration more nimble and public policy less intrusive.
Yet as a portion of the black middle class departs the urban North for the suburban South, the black population that remains mired in poverty may end up worse off, as the inner cities become concentrations of those with crippling socioeconomic problems. If Northern cities continue to lose middle-class residents (of all races), the greater the strain will be on governments to find tax revenue and deliver quality services. That doesnt bode well for the future.
Original Source: http://www.nytimes.com/roomfordebate/2011/07/25/how-budget-cuts-will-change-the-black-middle-class/the-black-middle-class-is-leaving-the-north