Household income increased and unemployment fell last year across Minnesota as the economy continued to improve, according to U.S. Census figures released Thursday. Black and Latino Minnesotans, whose household incomes had stagnated or even fallen during and after the Great Recession, shared a significant portion of the income gains.
The overall median household income of the state rose to $68,400. Black households experienced a bump in income for the third year in a row to $38,100. Black and Latino households each gained about $4,000 in 2017.
People who have historically been locked out of the labor market have been able to find jobs because of the strong economy, said Tawanna Black, CEO of the Center for Economic Inclusion in Minneapolis. She said the state's business community and political leaders have taken steps in the right direction in recent years to begin addressing economic inequities.
"The inequities are not only there because people lack skills, but also because employers have to be able to address racial bias, and have to be intentional about understanding the assets that people of color bring to the workforce and wanting to keep them there," Black said.
Although the income gains are good news, Black said too much of the new income people are earning is coming from temporary jobs.
"Communities of color are trying to recover from more than 50 years of disinvestment and racism and being behind, so while income is important, wealth is more important," Black said. "It's important to keep communities at the forefront of these conversations, and at the forefront of these decisions."
Part of the income increase is likely due to the fact that more people are working, said Andi Egbert, a researcher with APM Research Lab. The group is a division of American Public Media, which is the parent company of MPR News. There was a 5 percent jump in the number of black Minnesotans joining the labor force. Latinos in the state have the highest labor participation rate of all racial groups measured by the survey, at 77 percent participation.
"A lot of work effort there," Egbert said, "and what's nice is the economy is rewarding some of that hard work."
Income for black households in the state has slowly climbed in the last few years. As recently as 2014, the median household income for black households in the state fell by about $4,000.
State Sen. Jeff Hayden, DFL-Minneapolis, was one of the lawmakers who strongly advocated for more investment in economic opportunity for communities of color after those numbers came out. Hayden said Gov. Mark Dayton and the state Legislature had an intentional strategy to improve economic opportunities for people of color that included boosting state government business with communities of color and ensuring that the government's workforce reflected the diversity of the state.
They were also able to pass tens of millions of dollars in funding to reduce economic disparities between whites and people of color in the state.
It "looked at things specifically like entrepreneurship, jobs and technical training and then adult basic education," Hayden said, "which was really a key issue because there were a lot of folks who hadn't graduated from high school, who couldn't get a job because they were under-educated, and certainly couldn't get a job that could pay them a living wage."
Black, Latino and American Indian households still lag far behind the median household incomes of Asian and white Minnesotans. The key, Hayden said, will be for state government, the business community and nonprofits to continue to focus on expanding economic opportunity.
"I know we have a robust economy, but I do think that we will then give people the skills that will insulate them from the inevitable cooling off of the economy," Hayden said. "The folks that do better in that are the ones that have high-quality, in-demand skills."
Despite the encouraging economic news, the poverty rate in Minnesota held steady last year, with about 1 in 10 Minnesotans living under the poverty line. The official poverty line is just under $25,000 a year for a family of four.
"This rising tide, it does lift some boats, but certain parts of the economy don't function well for everyone," Egbert said. "There are a lot of challenges that still remain that simply having an abundance of jobs is not going to fix."
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