August, which is heralded as Black Business Month, should have been a time to celebrate the Black labor force. But last month’s jobs report showed unemployment rates increased for Black workers — and it could point to an economic slump.The unemployment rate for Black workers reached 7.5% in August — its highest level since October 2021 (7.6%) — and followed consecutive increases in June (6.8%) and July (7.2%). A rise in Black unemployment is often considered the “canary in the coal mine,” foretelling a slowdown for the broader job market. Video above: U.S. job growth weakens; immigration enforcement adds to strain”The most vulnerable people tend to get laid off first, and unfortunately, that tends to be Black Americans, and that’s something that is very disturbing in and of itself,” said Diane Swonk, chief economist at accounting firm KPMG US.Black Americans make up about 13% of the US workforce. A drop in Black Americans in the workforce can have a crippling effect on Black communities and on the US economy, which some economists say is already in a slowdown.Black Americans are expected to have buying power of $2 trillion by 2026, up from $1.7 trillion in 2024, according to a report from Nielsen.”When unemployment rises in our communities, it has a rippling effect across entire industries. Not just retail. Housing, health care — the impacts are across the board,” said Joyaa Cole, founder of Joe and Monroe, a Black-owned candle business in Houston.Cole said that higher rates of Black unemployment would be “devastating,” and it is twice as impactful on small, Black-owned businesses like her own, because Black customers may dial back on discretionary spending.Black Americans are slower to recover from job losses, which means it can be a long road to recovery. During the pandemic, President Donald Trump touted a jobs recovery in May 2020. But while White unemployment had fallen from 14.2% to 12.4%, Black unemployment held steady at 16.8%, according to the Bureau of Labor Statistics.The rise in unemployment for Black Americans contrasts Trump’s claims that Black workers would fare better under his leadership than under Democrats. In 2016, he famously asked Black voters, “What the hell do you have to lose?”‘If White America gets a cold, Black America really gets the flu’The jobs slowdown is due in part to Trump’s economic policies, which include cuts to the federal workforce — of which Black workers make up about 18.7% — sweeping tariffs and diversity, equity and inclusion crackdowns.Unemployment for Black Americans has led some Black-owned small-business owners to worry about an end-of-year sales slump.In Atlanta, Charmaine Gibbs-West, the owner of beauty brand Essence Tree, said she will have to let go of one contracted worker and won’t know whether she can bring back the contractor until the fourth quarter, which is usually the busiest time for her company.”A lot of my customers like to support Black businesses when they can, so to me the unemployment rate indicates that I may have to buckle up a little bit for my business sales,” she said.Video below: Federal Reserve considers interest rate cuts amid economic challenges from tariffsTonya Poindexter, board chair of the Northern Virginia Black Chamber of Commerce, told CNN that when the Black community can’t spend, it weakens small businesses — especially Black-owned brands, which 58% of Black Americans say are important to support to further equality, according to a Pew Research Center report in 2022.Nailah Queen, founder of wellness brand Regally Insane in Baltimore, said many Black Americans cut back on discretionary spending after job losses. Queen, who also operates Royalty Escapes Travel Agency, added that some clients are more hesitant to spend thousands of dollars on vacations because of concerns about their job stability.She plans to do more community outreach and product giveaways, in addition to pop-ups and educational events for Regally Insane in an effort to keep weary consumers engaged with her brand.Emmanuel Waters, co-founder of North Carolina-based Old Hillside Bourbon Company, told CNN: “I always say that if White America gets a cold, then Black America really gets the flu,” he said.Waters added that entrepreneurship can be a reliable opportunity for Black Americans because “the systems aren’t for us.”For Keta Burke-Williams, founder of fragrance brand Ourside in New York City, having a diverse customer base doesn’t mean she can avoid a drop in business when unemployment is high for Black Americans. She says maintaining good relationships with her customers when the economy falters is important because “not everyone gets to bounce back the same way.””Overall, I’m concerned about everything for everybody Black,” said Burke-Williams.
August, which is heralded as Black Business Month, should have been a time to celebrate the Black labor force. But last month’s jobs report showed unemployment rates increased for Black workers — and it could point to an economic slump.
The unemployment rate for Black workers reached 7.5% in August — its highest level since October 2021 (7.6%) — and followed consecutive increases in June (6.8%) and July (7.2%). A rise in Black unemployment is often considered the “canary in the coal mine,” foretelling a slowdown for the broader job market.
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Video above: U.S. job growth weakens; immigration enforcement adds to strain
“The most vulnerable people tend to get laid off first, and unfortunately, that tends to be Black Americans, and that’s something that is very disturbing in and of itself,” said Diane Swonk, chief economist at accounting firm KPMG US.
Black Americans make up about 13% of the US workforce. A drop in Black Americans in the workforce can have a crippling effect on Black communities and on the US economy, which some economists say is already in a slowdown.
Black Americans are expected to have buying power of $2 trillion by 2026, up from $1.7 trillion in 2024, according to a report from Nielsen.
“When unemployment rises in our communities, it has a rippling effect across entire industries. Not just retail. Housing, health care — the impacts are across the board,” said Joyaa Cole, founder of Joe and Monroe, a Black-owned candle business in Houston.
Cole said that higher rates of Black unemployment would be “devastating,” and it is twice as impactful on small, Black-owned businesses like her own, because Black customers may dial back on discretionary spending.
Black Americans are slower to recover from job losses, which means it can be a long road to recovery. During the pandemic, President Donald Trump touted a jobs recovery in May 2020. But while White unemployment had fallen from 14.2% to 12.4%, Black unemployment held steady at 16.8%, according to the Bureau of Labor Statistics.
The rise in unemployment for Black Americans contrasts Trump’s claims that Black workers would fare better under his leadership than under Democrats. In 2016, he famously asked Black voters, “What the hell do you have to lose?“
‘If White America gets a cold, Black America really gets the flu’
The jobs slowdown is due in part to Trump’s economic policies, which include cuts to the federal workforce — of which Black workers make up about 18.7% — sweeping tariffs and diversity, equity and inclusion crackdowns.
Unemployment for Black Americans has led some Black-owned small-business owners to worry about an end-of-year sales slump.
In Atlanta, Charmaine Gibbs-West, the owner of beauty brand Essence Tree, said she will have to let go of one contracted worker and won’t know whether she can bring back the contractor until the fourth quarter, which is usually the busiest time for her company.
“A lot of my customers like to support Black businesses when they can, so to me the unemployment rate indicates that I may have to buckle up a little bit for my business sales,” she said.
Video below: Federal Reserve considers interest rate cuts amid economic challenges from tariffs
Tonya Poindexter, board chair of the Northern Virginia Black Chamber of Commerce, told CNN that when the Black community can’t spend, it weakens small businesses — especially Black-owned brands, which 58% of Black Americans say are important to support to further equality, according to a Pew Research Center report in 2022.
Nailah Queen, founder of wellness brand Regally Insane in Baltimore, said many Black Americans cut back on discretionary spending after job losses. Queen, who also operates Royalty Escapes Travel Agency, added that some clients are more hesitant to spend thousands of dollars on vacations because of concerns about their job stability.
She plans to do more community outreach and product giveaways, in addition to pop-ups and educational events for Regally Insane in an effort to keep weary consumers engaged with her brand.
Emmanuel Waters, co-founder of North Carolina-based Old Hillside Bourbon Company, told CNN: “I always say that if White America gets a cold, then Black America really gets the flu,” he said.
Waters added that entrepreneurship can be a reliable opportunity for Black Americans because “the systems aren’t for us.”
For Keta Burke-Williams, founder of fragrance brand Ourside in New York City, having a diverse customer base doesn’t mean she can avoid a drop in business when unemployment is high for Black Americans. She says maintaining good relationships with her customers when the economy falters is important because “not everyone gets to bounce back the same way.”
“Overall, I’m concerned about everything for everybody Black,” said Burke-Williams.
