Black Americans ‘trade up’ to higher-paying jobs amid labour market squeeze

Six months ago, Carrin Hayes quit her job as a special needs teacher in Denver, Colorado, to become a truck driver.

“People look at me like I’m crazy, but teachers are underpaid and they are under-appreciated,” said Hayes. “I actually get paid more with a certificate. And I’m not as stressed.”

Hayes is among a growing number of black workers taking advantage of a pandemic-related boom in the transportation sector. She trained at Carter Truck Driving Academy, which is believed to be the only black-owned trucking school in the US. It opened in 2021 to serve a growing number of black residents interested in changing careers.

The increasing movement of black workers into transportation, as well as other sectors such as warehousing, construction and professional services, comes as many are leveraging the tight labour market to “trade up” from service jobs in search of higher wages and better working conditions.

“The number of black women who became truck drivers [over the past year] alone and meaningfully boosted their income was huge,” said Julia Pollak, chief economist for the jobs site ZipRecruiter.

The shift has helped them achieve the fastest wage growth of any racial group last year. The median black worker received an 11.3 per cent pay raise last year, compared with 7.4 per cent for all workers, according to labour department data.

Black workers hold low-wage jobs at retail stores, restaurants, hotels and theme parks in the US at disproportionately high rates. But many are quitting service jobs in favour of higher-paying jobs in areas such as transportation in a shift that economists hope will help permanently narrow the racial wage gap.

In 2019, one in five black workers worked in the leisure and hospitality sector, which paid an average wage of $20.77 per hour in December, according to labour department data. However truck transportation workers earned $29.54 on average, and more than twice as many had access to retirement benefits. Walmart advertises starting salaries of up to $110,000 for drivers in its private fleet.

According to an analysis by the White House Council of Economic Advisers, more black workers entered the transportation and utilities supersector than any other industry grouping tracked by the labour department in the first half of 2022. Nearly 11 per cent of black workers were employed in the sector in the first half of 2022, up 1.5 percentage points from the same period in 2019.

With an ageing workforce and high retirement rates, transportation and utility firms were desperate to expand their workforces even before the pandemic spurred a labour shortage. Supply chain snarls early in the pandemic made them even more so.

The racial reckoning that took place after George Floyd’s murder in May 2020 inspired many of these predominantly white companies to reach out to communities of colour for the first time, said Laron Evans, the president of the American Association of Blacks in Energy.

“Traditionally, thinking 10 to 15 years back, when I first started in industry I did not see a large share of under-represented groups within the industry,” said Evans, who also works as a director for Kansas City-based engineering firm Burns & McDonnell, which advises utility providers across the country.

“But in the past few years, you have seen an uptick,” Evans added. “I think that 2020 was a catalyst that gave things more steam.”

Transportation jobs, like many in other industries that saw a jump in the share of black workers in 2022, typically do not require college degrees, making them an easy transition for workers looking to get out of the service industry. Many employers have also begun subsidising certificate programs for workers looking to enter the field for the first time.

“We can’t only rely on traditional sources in terms of finding talent,” said Leon Harden, Burns & McDonnell’s Diversity Equity & Inclusion Strategy Manager. Burns & McDonnell sponsors STEM programs in local high schools and partnered with historically black colleges to diversify its own talent pool.

Last year 19.7 per cent of the 2.3mn truck transportation workers in the US were black, according to the labour department, up 1.2 percentage points from 2019.

Full-time black workers have earned roughly 20 per cent less than their white counterparts since the 1970s, even as the gap between the shares of black and white Americans with college degrees has narrowed, according to a study by economists at the University of Chicago and Duke.

Black workers did benefit from record low unemployment in 2019, but that progress reversed in 2020, when the Covid-19 crisis eliminated millions of leisure and hospitality jobs. The unemployment rate for black workers peaked at 16.8 per cent in May 2020, two percentage points higher and a month later than the overall unemployment rate. In January, the black unemployment rate dropped to 5.4 per cent, the lowest since the pandemic began, but still much higher than the overall rate of 3.4 per cent.

“Things haven’t been as bad as they were, but then that’s because in the past it has been much worse,” said Patrick Mason, a professor of economics at Florida State University. “So I’m worried that wages aren’t keeping up with the pace of inflation and particularly the wages for the least educated.”

Trucking jobs were also highly sensitive to economic shifts, Pollak said. The transportation and utilities sector is one of just three where workers are being laid off at rates higher than before the pandemic as companies prepare for an economic downturn.

“It can be a very variable industry where income is not stable and depends very heavily on economic conditions,” Pollak said. “So I do worry that some of the workers who enter that industry are now struggling.”

Hayes, the Colorado teacher-turned-trucker, said the sector was still grappling with how to be more inclusive towards black workers. In Colorado, 91 per cent of commercial driver’s licence holders who self-reported their race are white, according to the states’ department of motor vehicles.

“This is a very scary industry, especially for people of colour,” said Hayes.

“But once you break through that barrier, you can have people knocking on your door, saying ‘Hey, I heard you have your [commercial drivers licence], please come work with me’.”