• Employment levels recovered for Hispanics overall and for Hispanic men, declined for African Americans, and remained unchanged for Whites.
  • The Welch Index remained unchanged for White men and women.
  • The Index levels declined for both African American men and women.
  • Index levels for 2021 have remained highest for Whites, followed by Hispanics, and then African Americans.
  • For all races, current Index values continue to be well below their pre-pandemic levels.

Welch Consulting Employment Index by race and gender graphIntroduction

The Welch Index for Race is a data analytics tool used by our labor economists to measure full-time equivalent employment for Hispanics, African Americans, and Whites after adjustment for population growth. An Index value of 100.0 indicates that this adjusted full-time equivalent employment level is the same as what it was in July 2019.

Any decrease (or increase) in the Index value over a particular period implies that the full-time equivalent employment level has decreased (or increased) relative to the growth of the adult population during that period.

For example, over the past 12 months, the Index has fallen 8.1 points for African Americans, from 100.0 to 91.9. In other words, the level of full-time equivalent employment for African Americans has increased at a rate 8.1% slower than the increase in the U.S. African American adult population over the past year. This decline in the employment level is 3 points greater and .3 points lower, respectively, than the decline that Whites and Hispanics have experienced over the past one year.

For all race groups, the bulk of the last one-year decline has occurred between January and April 2020. This is attributable to the onset of the COVID-19 crisis and related lockdown measures.

Welch Consulting offers data consulting services to help employers analyze and learn from large and complex data.

Employment Levels Recover for Hispanics

The Welch Index for Whites increased by .2 points from December of last year to early this year and has remained unchanged at a value of 95.4 points since January.

The start of the year looked promising for African Americans, with an increase in January of 1.4 points compared to December. But February values experienced a decline, with the employment levels falling by .6 points, from a value of 92.5 in January to 91.9 in February.

Employment levels of Hispanics have steadily increased in 2021, from 92.7 in December of last year, to 93.3 in January, and to 93.7 in February of this year.

Welch Consulting Employment Index table by race
The recovery rates as of February remain lower for Hispanics and African Americans than for Whites. The fraction of the January to April 2020 decline of 13.9-points that Whites recovered in 2021 has been close to 62%. As of February, African Americans have recovered close to 52% of the 16.3-point decline in employment levels due to the onset of the pandemic in early 2020. Hispanics experienced a decline of 19.9 points between January and April of 2020. Of this decline, they have recovered close to 58.8% as of February.

Over the last three years, the Index levels have declined by 4, 7, and 5.1 points, respectively, for Whites, African Americans and Hispanics.

Increase in Employment Levels for Whites and African American Men

The Index levels declined for both African American men and women in February. For African American men, the Index declined by .9 points over the last month, to a value of 92.0 in February. For African American women, the decline was lower. Their Index declined by .4 points, from 92.1 in January to 91.7 points in February.  Both African American men and women experienced an almost similar decline of 16.4 and 16.3 points, respectively, between January and April of last year. However, as of February, women had recovered about 44% of this decline while men had recovered over 59% of this decline.

Following a generally steady increase since September, the Index levels for White men and women stabilized at 96.1 points and 94.8 points, respectively, in January and February of this year. As of February, White men had recovered close to 59% of the January to April 2020 decline. While this initial decline in Index levels that White women experienced was 2.9 points higher than that of White men, they recovered over 65% of the fall as of February.

Welch Consulting Employment Index table by race and gender
The overall Welch Index increased by .4 points for Hispanics between January and February, driven by the increase in Index levels for Hispanic men. For Hispanic men, the Index levels rose 1 point, from 94 points in January to 95 points in February. For Hispanic women, on the other hand, the Index levels declined by .3 points, from 92.2 in January to 91.9 in February. From January to April of last year, when the pandemic hit, the employment levels saw a dramatic decline for Hispanics, of 21.6 points for Hispanic women and of 18.7 points for Hispanic men.  Of this decline, the two groups have recovered close to 57% and 58% respectively.

Underlying Factors Behind Employment Index Trends and Concluding Remarks

Our economic consulting experts find a pickup in employment in the services sector following a relaxation of dining restrictions and an increase in vaccine administration. Retail and manufacturing sectors also saw an increase in employment, while education, mining, and construction sectors witnessed a decline. The different employment trends experienced by the different racial groups in February can be explained to a certain extent by the differences in how these groups are distributed across these sectors.

Technical Note: Full-time equivalent employment equals full-time employment plus one half of part-time employment from the BLS household survey (the Current Population Survey). The data reported for a given month is generally from the calendar week that contains the 12th day of the month. The Welch Index for race is based on individuals who are 20 years old and over. Seasonal effects for the share of workers employed in part-time jobs are removed in a regression framework using monthly indicator variables.

Jobs report February 2021: Growth surges on hiring jump in hospitality (cnbc.com)