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The Trump Economy Working for Minorities


Despite his reputation for being racially divisive, President Trump’s approval ratings have drifted upward among non-Whites in the last 2 years.

While it’s impossible to say exactly why, but a reasonable explanation is that the US’s long economic expansion has been particularly beneficial for minority workers.

There is strong evidence that President Trump’s rhetoric on race is hurting him among minorities, in fact it is not.

In the latest Gallup poll of Presidential job approval, President Trump stands at 22% among non-Whites, just shy of his 23% record last April. For comparison, the President’s approval ratings among self-identified liberals and moderates are 6% and 29%, respectively.

While President Trump’s Tweets may be hurting him among minorities, the economy is helping him. As the President is fond of pointing out, unemployment rates among African-Americans, Hispanics and Asians are all at historic lows.

Just as important, the unemployment gaps between both Blacks and Whites and Hispanics and Whites have reached all-time lows. It is not just that the job market has been good: for minorities, it has been historically good.

This pattern is not uncommon during economic expansions. The longer a tight labor market persists, the more willing employers become to consider applicants they once would have passed over.

Social networks between employers and marginalized communities strengthen, and companies get better at attracting and retaining minority workers.

As opportunities for racial minorities grow, wages rise faster as well. Over the past 12 months wage gains for non-Whites have been not only substantially higher than those of Whites, but also higher than economists’ estimates of inflation plus productivity. That implies that minority workers are getting a greater share of GDP.

It is ironic that this is all occurring under a President who ran on a not-so-subtle campaign to revive the White working class. The effects of the administration’s tax cuts, and the strong consumer spending they spurred have been felt most in metropolitan areas with a high proportion of wealthier households. The spending has gone largely to services, which are provided by local workers.

Rural areas and the industrial heartland are far more dependent on exports of agricultural and manufacturing products as such, have been hurt by the President’s trade dispute.

As a result it may be unlikely that President Trump will be able to capitalize politically on improved economic conditions for minorities. They may shore up some of his support in the Sun Belt, but may be little help in most battleground states.

Rhetoric tends to dominate the political narrative.

But policy is far more important in determining outcomes for workers. Wittingly or not, President Trump’s policy has been more favorable to minority workers than they expected, and less favorable to the White working class than he promised.

By Karl W. Smith

Paul Ebeling, Editor

Editor’s Note: Karl W. Smith is a former assistant professor of economics at the University of North Carolina’s school of government and founder of the blog Modeled Behavior.

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