Demographics and Disparities in the Fifth District

The Richmond Fed’s headquarters is on the north shore of the James River, in downtown Richmond, Virginia, the former capital of the Confederacy. The remains of a bridge burned by retreating Confederate soldiers still jut out of the water. Directly across the river is Belle Isle, which between 1862 and 1864, held an estimated 20,000 Union prisoners of war. Less than two miles away, one of the busiest slave markets in the South operated in the decades before the Civil War.

Virginia is not the only Fifth District state with a troubled past. The slave trade thrived in the District of Columbia until 1850, and slavery was not abolished in the city until 1862. Both North Carolina and South Carolina joined the Confederacy. Maryland did not secede but was a slave state. West Virginia did not abolish slavery until 1865, nearly two years after it was admitted to the Union.

In the context of this history, the Richmond Fed is working to understand the racial and ethnic disparities that exist across dimensions ranging from health to mortgage finance to education, and to identify promising initiatives to address them. This Regional Matters post is an introduction to the district’s demographic makeup and differences in educational and labor market outcomes.

Urban and Rural Populations

Nationwide, 12.3 percent of the population (aged 15 +) identifies as black or African American. The share is higher in the Fifth District, where 22.6 percent of the population is black (Table 1). West Virginia is the only Fifth District state where the black population makes up a smaller share than in the nation as a whole. The fraction of the Fifth District population that is Hispanic is 7.1 percent, compared to 16.9 percent nationwide.

Table 1: Percent of Population (aged 15+)

Source: American Community Survey 2014-2018. “Black” may also include individuals who identify as Hispanic. “Hispanic” includes people of any race.

Figures 1 and 2 provide more detail about where people live. Consistent with the Fifth District’s proportionally larger black population overall, the black population is also a much higher share of our rural areas and smaller towns. The highest shares are in the Carolinas (36.7 percent in South Carolina and 23.2 percent in North Carolina). The share of Hispanics in the district’s rural/small-town areas is smaller than the national average, at 4.4 percent.¹

Blacks are a higher share of the U.S. population in urban areas, at 13.5 percent nationwide. Hispanics comprise nearly 20 percent of the urban population, and white, non-Hispanic individuals are 58.3 percent. As with rural areas, the black share of urban areas is larger in the Fifth District. In the District of Columbia, which was a majority black city until 2011, the population is 45.4 percent black. The next highest share is Maryland, where 30.5 percent of urban residents are black.

Since 1980, Fifth District counties have generally become less segregated, although that is not universally true.

Labor Market Outcomes

Labor market outcomes differ considerably by race and large gaps in unemployment rates are a persistent feature of the labor market, even when unemployment overall is low. Figure 3 shows that in the 2014-2018 period, the national unemployment rate for black men aged 16-64 was 11.9 percent versus 5 percent for white, non-Hispanic men. Black and Hispanic women also were more likely to be unemployed than whites. This is true in the Fifth District as well, although unemployment rates in the Fifth District are lower for blacks and Hispanics than the national average. The gap narrowed as unemployment rates rose to unprecedented levels this spring but remained sizeable. In June, the unemployment rate among white workers was 10.1 percent, compared to 15.4 percent and 14.5 percent for blacks and Hispanics, respectively.

Both in the United States and in the Fifth District, unemployment for all groups was lower in urban areas over the 2014-2018 period, although urban blacks were more likely to be unemployed than urban whites. In the Fifth District, however, urban blacks tended to fare better than urban blacks nationally. Hispanic men in all areas of the district were less likely to be unemployed than Hispanic men nationally, but the same was not true for Hispanic women, as seen in Figure 4.

Nationwide, there is a large gap in labor force participation between white men and black men, particularly in rural areas and smaller towns (Table 2). The gap is smaller in the Fifth District, in part because white rural/small-town men participate at relatively lower rates and in part because black men participate at relatively higher rates (although they are still less likely to be in the labor force than white men). There is also a national gap in participation between rural/small-town white and black women. But this gap is reversed in the Fifth District. Nationwide, Hispanic men and women are less likely to be in the labor force than white men and women in all areas. For women, this is true in the Fifth District as well, but Hispanic men in the district have higher participation rates than white men.

Table 2: Labor Force Participation Rates, 2014-2018, ages 16-64

Source: American Community Survey 2014-2018

Educational Attainment

One measure of educational attainment is the degree to which students finish high school or college. (Of course, a four-year degree is not the only post-secondary educational opportunity, but data on four-year degree completion is more easily obtained and interpreted than much of the data on technical or community college enrollment or completion.) With respect to both high school and college completion rates, black and Hispanic students fall behind white students. Nationwide, 89 percent of white, non-Hispanic students graduate from high school within four years, compared to just 79 percent of black, non-Hispanic students, and 81 percent of Hispanic students. (Table 2). In all Fifth District states other than the District of Columbia and South Carolina, the graduation rate for black students is higher than the national average.

Black and Hispanic students also have lower college graduation rates than white students. For both groups, college graduation rates are generally higher in the Fifth District than in the United States as a whole (when looking at four-year public institutions).

Table 3: Graduation Rates

Sources: Adjusted Cohort Graduation Rate from the National Center for Education Statistics; National Student Clearinghouse. In the NCES data, black and white is non-Hispanic; uncertain if the NCS data separates it

Graduation rates measure the flow of educational attainment over time, but we can also look at the share of the white, black, and Hispanic population that have obtained bachelor’s degrees — a milestone that is strongly associated with higher earnings and employment. By this measure, blacks and Hispanics also lag whites, as seen in Figure 5. As with unemployment and labor force participation, however, outcomes tend to be better for blacks and Hispanics in the Fifth District; a slightly larger share of blacks and Hispanics have bachelor’s degrees in the Fifth District than in the nation as a whole.

The large observed differences in employment and educational outcomes cannot be explained solely by the district’s and the nation’s legacies of slavery and explicitly racist policies. Understanding the sources of these disparities in our communities, as well as those related to earnings, health, and wealth, is the subject of ongoing research. We’ll be sharing what we learn on this blog and in other publications and presentations.

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Views expressed are those of the authors and do not necessarily reflect those of the Federal Reserve Bank of Richmond or the Federal Reserve System.