Report: Barriers Remain for College-educated Blacks and Latinos
David R. Jones | 8/27/2015, 4:09 p.m.
Is a college degree still worth the ever-increasing cost of tuition? Will it really help you climb the socio-economic ladder in America? And once you’ve climbed it, will you be able to remain there? Those are legitimate questions in light of a study released earlier this month analyzing wealth data over two decades.
While the study argues that a college degree is the surest way to increase your earning potential over time and compete for well-paying jobs in today’s economy, there is a caveat.
If you happen to be black or Latino, the report warns that higher education alone will not insulate you and your family from short-term economic downturns or adverse long-term income trends as it apparently has for other racial and ethnic groups.
Minorities suffer more during rough economic periods
The Center for Household Financial Stability study, “Why Didn’t Higher Education Protect Hispanic and Black Wealth?” found that median incomes for all American families headed by someone with a college degree was 2.4 times the median income of families headed by someone without a degree. Similarly, families headed by college graduates achieved greater net worth compared to non-college graduates -- $273,586 versus $43,635 based on 2013 figures.
Focusing on a six-year span (2007- 2013) that included the Great Recession and its aftermath, the report found that the median wealth of all families headed by a college graduate declined by 24 percent. For families without a college degree, their accumulated wealth declined by nearly 50 percent.
While white and Asian college-headed families weathered this period of financial turbulence much better than their less-educated counterparts, it was quite a different story for blacks and Latinos. For example, the wealth of black college-headed families declined by 60 percent compared to 37 percent for non-college grad black families. Median wealth for Latino college-grad families declined even more -- 72 percent compared to 41 percent for non-college grad Latino families.
The underlying causes behind the disparities in wealth and income presented in the report, as the authors point out, are longstanding and complex. Even so, some of the factors contributing to the ethnic wealth gap are well-documented.
For instance, irrespective of their level of educational attainment blacks and Latinos were twice as likely to be impacted by the housing crisis as whites. And while predatory lenders primarily hawked their subprime loans to less savvy borrowers, many college-educated black and Latino families were not immune to discriminatory lending practices that saddled them with high-priced home mortgages. When the housing market collapsed, a disproportionate number of blacks and Latinos lost their homes to foreclosure or found themselves steeped in debt.
It’s also true that blacks and Latinos tend to earn less than whites, experience higher rates of unemployment and hold fewer advanced or professional degrees in specialized fields. And despite great strides diversifying the workforce, racial discrimination continues to play a role in hiring decisions. And lest we forget, racism is still alive and well in our society. Just consider the thinly-veiled appeals to racism and intolerance spewed by 2016 Presidential hopeful Donald Trump and some of his Republican rivals as they detail their positions on immigration.