BUSINESS
01/17/2011 12:21 pm ET Updated May 25, 2011

Black Americans Especially Vulnerable To Budget Austerity, Study Shows

Whenever governments cut spending, the pain is uneven.

But African Americans are especially vulnerable, as a disproportionately high number rely on government dollars for crucial services, a new study has found. As black people are more dependant than white people on public safety nets, and are more likely to be on public payrolls, governmental austerity could wound the black community especially severely.

In the wake of the worst economic downturn since the Depression, local, state and federal governments have contended with often massive budget deficits. As officials cut spending to compensate for diminished revenue, society's most vulnerable members are losing essential services. In a political climate where austerity is considered a virtue, and where "belt-tightening" is seen as necessary for re-energizing the economy, many black Americans could see their lives upended.

Nearly 60 percent of older black people rely on Social Security for more than 80 percent of their income, according to the study, released Friday by the Boston-based non-profit United for a Fair Economy. That's compared to 46 percent of older white Americans.

"These programs are to lift up all Americans, regardless of race," said Brian Miller, executive director of United for a Fair Economy and a co-author of the report. Still, he added, "for black and Latino households, things like social safety nets are far more important."

The safety net is not all that's at stake. African Americans are 30 percent more likely than the overall workforce to hold public sector jobs -- and 70 percent more likely to work for the Federal government, the study found.

Spending cuts, then, amount to a "one-two punch" for black households, Miller said.

"Not only do they get these cuts in public services, they also get hit with layoffs," he said.

Budget austerity would come at a time when unemployment among African Americans has reached epidemic proportions. Last month, the national unemployment rate was 9.4 percent, and the white unemployment rate was 8.5 percent. For black Americans, it was 15.8 percent.

As plunging home prices have ravaged household wealth, the effects have been particularly painful in black communities. Neighborhoods with a disproportionately high concentration of African Americans have experienced a dramatically higher rate of foreclosure, according to a study released in October. At a time when the national foreclosure rate was 4.14 percent, in black communities that rate increased by 1.68 percentage points.