Segregation and the Racial Wage Gap - Term Paper Example

The image of the black man, being relegated to lower rung jobs, being inadequately compensated and constantly striving to prove himself has gone through a drastic change, report Mary Daly, Federal Reserve Bank of San Francisco and Kenneth A. Couch, University of Connecticut. Their study has pointed out that an increase in the weekly pay of black male workers rose substantially so as to narrow the gap between black and white earnings to its lowest historically recorded levels. (Gene Koretz) This Discrimination in wage earnings begins at an early stage in the careers of black men and these have a direct impact on the “future labor earnings.

” This wage inequality starts with the first job and continues to grow during the first five years of “post-school labor market activity” (Renna, King, 2007) This gap in earnings is considerable, growing from 12.46% during the first post school job to 25.86% even five years later. The statistics concerning racial wage gap may reveal the narrowing of the phenomena, but in all economic matters, racial inequality is an undeniable fact. African Americans face unemployment two times more than their white counterparts and even when employed they may earn only 75 per cent of what their white colleagues receive as wages.

(Council of Economic Advisers, 1998) In the first few years in the job market, the incumbent is at a lower rung due to educational qualifications, but over the years this factor ceases to have an impact on the wage potential, because the employer is aware of the productivity levels of the employee. Thus, while the wage gap narrows over the years, it shows a direct proportional decrease with the increase in the number of years spent in the wage market. The lower wage workers have seen an increase in their pay structure, and more importantly, the reduction in wage gap