Examining the Differential Impact of Recessions and Recovery across Race and Gender for Working- versus Professional-Class Workers

Abstract

We investigate how wages and occupation sorting vary by race, gender, and class during recessions. We performed repeated Kitagawa-Blinder-Oaxaca decompositions of the Black-White wage gap from 1988 to 2020. Black professional-class workers’ wages are more unstable and take a more substantial hit during recessions. Black workers see a lower return to their labor market characteristics during recessions, and this is pronounced for the professional class. Using an occupational crowding methodology, we find that Black women are overrepresented in essential work and roles with high physical proximity to others and receive the lowest wages. White men are crowded out of riskier work but, within these categories, dominate higher-paying roles. Black workers earn less in professional riskier work than in working-class roles, while the reverse is true for White workers. We find that class status does not protect Black workers to the same extent as White workers, especially during recessions.