Employment Growth by Race and Ethnicity Since the Last Election Part I: The Spatial Reorganization of the US Economy under Obama

Johannes Moenius Analysis, Employment, Income & Wealth, Reports 0 Comments

Eight years ago, the United States was just about to hit the bottom of the most severe recession since the Great Depression. In some areas, entire industries, such as construction in Southern California, were decimated down to a fraction of their original size. How have racial groups and ethnicities fared since then? How did this affect how certain regions performed relative to others? How did city centers perform relative to the periphery? Did possible disparity in growth across regions benefit or hurt certain racial and ethnic groups?

In this brief analysis, we first provide summary statistics of employment growth over the last eight years by racial group.[1] Next, we establish our reference point for future posts: we compare overall job growth in the top 25% of the fastest-growing zip codes in U.S. metropolitan statistical areas (MSAs) against the bottom 25%. In our next set of posts, we will show how different racial groups fared during the last eight years across different regions in the United States.

We find that in the last eight years, overall employment growth barely kept pace with population growth. Contrary to this general trend, minorities saw sizable improvements with Blacks, Hispanics, and especially Asians seeing the largest employment increases. Job growth during Obama’s second term clearly outperformed that of his first term, which coincided with the lowest point of the Great Recession. Employment growth in MSAs, which include almost 80% of U.S. jobs, was higher during Obama’s second term.[i] Suburbia sprung back to life, while many city centers shed jobs. The Rocky Mountain economic region fared best in the last eight years, with a compound average job growth rate (CAGR) of 2.2% in its MSAs. The Mideast fared the worst, with about 1.1% growth during those eight years.

Figure 1 shows average employment growth by racial group in the last eight years. Job growth under the Obama administration was positive across all racial groups, but with huge differences – Asians experienced the largest job growth and Whites, the smallest. Job growth under Obama was generally slower than that of preceding presidents. Only Asian Americans experienced a slightly higher level of job growth under Obama than under earlier Democratic presidents. However, both Asians and Hispanics experienced higher job growth under Obama than they saw on average under Republican presidents.

Average Annual Employment Growth Across Racial Groups, January 2009 till September 2016

Figure 1: Average Annual Employment Growth Across Racial Groups, January 2009 till September 2016

Figure 2 shows average job growth by race during the Obama presidency, excluding his first two years in office. Excluding the first two years, which were troubled by the Great Recession, job growth during the Obama years looked similar to that of earlier presidents, but with the distinct difference of a larger spread between job growth for non-Whites versus Whites. This is partially due to the fact that Blacks and Hispanics suffered substantially higher increases in unemployment than Whites and Asians during the Great Recession. Consequently, they had to compensate for these larger losses in order to reach pre-recession employment levels.

Average Annual Employment Growth Across Racial Groups, January 2011 till September 2016

Figure 2: Average Annual Employment Growth Across Racial Groups, January 2011 till September 2016

Figure 3 shows average job growth by race during years 5-8 of the Obama presidency. The job market recovery coincided with President Obama’s second term, which shows roughly the same pattern across all racial groups as under previous Democratic presidents.

Average Annual Employment Growth Across Racial Groups, January 2013 till September 2016

Figure 3: Average Annual Employment Growth Across Racial Groups, January 2013 till September 2016

Next, we turn our focus onto the spatial pattern of job growth. Within MSAs, the weighted average of zip code employment during the last eight years was 1.3%. This is higher than the growth rate of jobs nationally, which was 0.9%.[ii] Many zip codes grew faster than the average, and many grew substantially slower. Figure 4 shows the spatial distribution of the 25% fastest growing zip codes (in green) and the 25% slowest growing zip codes (in red). According to our estimates, the bottom 25% of zip codes has fewer jobs today than when President Obama first took office. Part of this is due to the fact that these zip codes had not yet reached rock bottom when President Obama entered the White House. However, even after the recovery, the bottom 25% never fully recovered jobs lost in the Recession.

US Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Figure 4: US Average Annual Employment Growth by Zip Code (2008-2016), Top and Bottom 25%

On the other hand, the top 25% fastest-growing zip codes have reached new heights. Not surprisingly, much of this job growth happened in the periphery, where costs are generally lower and space is plentiful. A more detailed look reveals that areas further from city centers do not always benefit – these far out, more rural areas actually frequently saw continued job losses. It is the periphery close to the centers that generally benefits the most.

Aside from city patterns, there are also strong regional patterns. Table 1 shows employment growth in MSAs by Bureau of Economic Analysis (BEA) region. The first column lists the name of the economic region as defined by the BEA. The second column shows the employment growth rate within MSAs in each region (aggregated over zip codes). The last four columns show the share of MSA employment in each BEA region that falls into one of four zip code growth quartiles: the bottom 25% zip codes with the lowest growth up to the top 25% of zip codes that grew the fastest. For example, 7.6% of all MSA employment in the Great Lakes region are among the 25% slowest growing zip codes. Only 17.9% of MSA employment in this region fell into the top 25% of zip codes. As the table reveals, more than its share in terms of employment, the Mideast has seen substantial economic challenges with low growth. The Plains, Great Lakes and New England regions have not fared much better. All of them saw similar patterns of low growth rates combined with either low employment shares in fast growing zip codes or high share of employment in shrinking zip codes.

    Employment Share (%) in Zip Codes Growing
BEA Region Job Growth (%) Slowest Slow Faster Fastest
Far West 1.49 4.8 30.5 42 22.6
Great Lakes 1.14 7.6 37.1 37.5 17.9
Mideast 1.09 6.2 38.4 40.3 15.1
New England 1.19 6.5 33.7 45.7 14.1
Plains 1.14 6.3 34.8 43.3 15.7
Rocky Mountain 2.21 2.6 21.3 44.1 32
Southeast 1.33 6.8 30.5 41.4 21.3
Southwest 1.75 5.8 28 38.5 27.7
Average 1.34 6.2 33.3 40.9 21

Table 1: Employment Growth in MSAs, by BEA Region

Table 2 shows employment growth in MSAs by state. While Rocky Mountain states have done well, southern states such as Louisiana and Alabama carried some of the larger burdens of economic restructuring. The MSAs in Utah, Colorado and Idaho grew the fastest, and those in New Mexico, West Virginia, and Wyoming, the slowest. Colorado, Nebraska and Texas had the largest employment share within fastest growing zip codes (see last column), while Nevada, Alabama, West Virginia, and Louisiana had the largest employment share within slowest growing zip codes (see column 3).

    Employment Share (%) in Zip Codes Growing
State Job Growth (%) Slowest Slow Faster Fastest
AK 1.42 2.5 30.2 53.2 14.2
AL 0.53 13.7 41.7 33 11.6
AR 1.06 5.8 44.2 30.1 19.9
AZ 1.09 9.1 38.5 34.4 18
CA 1.47 4.8 30.5 41.6 23.1
CO 2.25 3.2 19.9 39.6 37.4
CT 0.51 12.3 45.1 31.3 11.3
DC 1.35 3 34 45.3 17.8
DE 1.48 2.3 32.4 46.6 18.7
FL 1.63 4.4 25.9 47.6 22.1
GA 1.47 7 25.1 43.5 24.4
HI 1.14 2.4 43.8 47 6.7
IA 1.18 4.2 40.4 42.6 12.8
ID 2.03 1.4 18.4 55.5 24.7
IL 0.89 9.7 43.1 33.9 13.3
IN 1.41 7.4 29.6 37.6 25.4
KS 0.18 15 47.6 30.3 7.1
KY 1.73 3.6 18.7 53.1 24.7
LA 0.6 12.8 44.5 22.2 20.5
MA 1.45 4.6 29.4 50 16
MD 1.17 4.3 36.1 52 7.7
ME 1.07 1.2 42.5 50.9 5.4
MI 1.63 7.2 25.7 41.1 26
MN 1.41 4.8 33.4 40.9 20.8
MO 0.96 6.2 33.9 52 7.9
MS 0.48 11.9 47.9 26.4 13.8
MT 1.28 1.1 47.9 43.8 7.3
NC 1.3 6.9 29.4 42.4 21.3
ND 2.18 1.4 0.8 66.5 31.3
NE 1.08 11.1 44.4 11.9 32.6
NH 1.91 . 17.9 78.7 3.4
NJ 0.53 11.7 40.9 37.7 9.7
NM 0.22 11.5 64.3 22.9 1.3
NV 1.3 15.6 24.7 41.6 18.1
NY 1.3 5.4 34.7 41.7 18.2
OH 1.02 7 38.6 38.3 16.1
OK 0.87 8.3 39.6 36 16.1
OR 1.67 3.3 26.3 45.6 24.8
PA 0.71 8.3 48.8 30.6 12.4
RI 1.15 8.7 32.6 41.3 17.4
SC 1.79 4.6 22.8 41.8 30.8
SD 1.98 0.7 20.9 56.4 22
TN 1.57 5.3 27.8 42.2 24.7
TX 2.09 4.5 22.4 40.6 32.5
UT 2.49 2.2 18.3 48.7 30.8
VA 0.95 8.3 42.2 38.6 10.9
VT 1.66 3.4 26.9 52.3 17.4
WA 1.64 2.1 32.8 40.7 24.5
WI 0.86 4.5 46.5 37.9 11.1
WV 0.07 12.8 48.9 26 12.4
WY 0.36 1.4 65.9 29.3 3.4
Average 1.282057 6.9 35.3 40.7 21.0

Table 2: Employment Growth in MSAs, by State

Despite these general observations, a brief glance at Figure 4 indicates that each city seems to have its own story. The maps below show Figure 4 in detail, by BEA region. Please help us discover these stories by posting comments about your home town in the comments section below. You can directly explore data for your home town in our Data Explorer. In the Data Explorer, you can create a report about your city by following these directions:

  1. First, make sure that you allow pop-ups for this site.
  2. Search for your city in the search bar.
  3. Click “Create Report” on the left side of the screen.
  4. Choose a selection tool.
  5. Click and drag or click repeatedly to select the area around your city.
  6. Click “Run Report”.

 

Maps by BEA Region:

New England Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

New England Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Mideast Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Mideast Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Hawaii Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Hawaii Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Great Lakes Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Great Lakes Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Far West Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Far West Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Alaska Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Alaska Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Plains Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Plains Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Rocky Mountains Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Rocky Mountains Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Southeast Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Southeast Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Southwest Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

Southwest Average Annual Employment Growth by Zip Code 2008-2016 Top and Bottom 25%

[1] We follow the convention established in our previous posts to call both racial and ethnic groups “racial groups” in short.

[i] However, those numbers are not fully comparable as they come from different, uncoordinated data sources maintained by the BLS.

[ii] See previous endnote.

Authors: Johannes Moenius, Ph.D. and Jess Chen, Ph.D.
Institute for Spatial Economic Analysis,
University of Redlands, School of Business

Contact: Johannes Moenius, Ph.D., isea@redlands.edu, 909-557-8161
Director, Institute for Spatial Economic Analysis,
University of Redlands, School of Business

Leave a Reply

Your email address will not be published. Required fields are marked *