Race &Recovery

In a City Split Along Race, Black D.C. Workers See Strong Economic Recovery

Bloomberg is tracking the economic recovery in minority communities across the country

By Andre Tartar, Alex Tanzi and Christopher Cannon

June 30, 2021, 5:00 AM EDT

The economic recovery in Washington, D.C., was buoyed by federal government jobs. Now, the city faces the tougher challenge of getting private-sector business back.

That’s the view of the mayor of the nation’s capital, Muriel Bowser, who visited New York City this week in part to draw a return of corporate travel.

“We need office workers back,” she said, including from new employers. “Companies are going to look to move and we want them to look to D.C. when they do.”

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In the District of Columbia, where the population of Black and White residents is about evenly split, the economic rebound has been strong. The region is seeing some of the lowest unemployment rates among major metropolitan areas for both racial groups, according to an analysis by Bloomberg.

A key element of that resilience is the concentration of jobs in the federal government, which provided a floor of sorts. The local recovery is also supported by a rising housing market for White and Black neighborhoods, though there are hard-to-miss signs of economically vulnerable people being squeezed out.

A Divided Capital

Washington, D.C. is increasingly split in two, with its large Black population clustered in the city’s less-affluent eastern wards, which were hit hardest by Covid-19.

The Income Gap

Majority-Black areas tend to have lower median household incomes than more White areas, though there are a few pockets of Black wealth, including neighborhoods to the south and east of the city.

The Wealth Gap

There are now 16 zip codes where the typical home is worth at least $1 million, most of which are predominantly White, up from 11 before the pandemic and just one a decade ago. Meanwhile, the majority-Black zip code with the most expensive residential real estate tops out at $763,587.

A Housing Boom

As the economic recovery takes hold, Black neighborhoods are seeing home prices rise by around 14% from a year ago, on average, compared to 11.9% for majority-White areas. They’re also seeing more new businesses open per capita than the metro area overall.

Home Equity

Rising home prices mean hundreds of thousands of homeowners will see gains in the equity stakes they own, including in the District’s majority-Black wards, improving their financial resilience.

“The question about displacement is real in D.C.,” Mayor Bowser said in an interview with Bloomberg Tuesday.

While the share of Black and White people in the city is about equal—at 46% each in 2019, according to Census data—that compares to 51% Black and 42% White in 2010.

More people have moved into the city limits in recent years as Washington’s economy has diversified, drawing industries such as technology—including Amazon’s HQ2 headquarters in neighboring Virginia—biotech, data centers and a burgeoning lobbying business.

“Where we see the job growth is the private sector,” Bowser said.

On a recent summer day in June, the Anacostia region of D.C.—which has a concentration of Black households—is teeming with people as activity resumes after pandemic restrictions.

The new Starbucks in the area—the neighborhood’s first standalone store—has a steady flow of customers as an Earth, Wind & Fire song plays in the background. An apartment building on the block is actively trying to sign people up to lease a unit.

There’s been a steady uptick in Paycheck Protection Program loans going to Black D.C. neighborhoods in recent months, with April being the first month when they received more than White areas. But overall, those areas have received relatively less loan money compared with majority-White neighborhoods as well as many other cities, according to data through May 2021 compiled by Bloomberg.

Even still, majority-Black areas of the District have actually seen a faster pace of new businesses opening since March 2020, according to Yelp data.

David Boyd, whose family has owned a tavern near the Maryland border for decades called Takoma Station, received money after his business closed for three months during the pandemic and racial protests in the city last year.

“There are many different folks that are starting to move into the neighborhood because it’s expanding, because of building more apartments, building more town homes,” he said.

The lack of activity in the center of D.C.—around the White House and National Mall— during the pandemic has also changed the economy for neighborhoods like Boyd’s.

“We’re starting to get more businesses, more nightlife and people are coming to the areas that are on the outskirts of D.C.,” he said. “It’s kind of doing a flip because there is no reason to be downtown.”

Downtown and Northwest D.C. have lower unemployment rates than the poorer, majority-Black wards across the Anacostia River, which were hit particularly hard by the Covid-19 pandemic.

The Mayor pointed to incentives for vaccinations at centers in wards 7 and 8, as well as funding to support increased homeownership where it’s low, as policies aimed at closing some of these gaps.

The unemployment rate for Black people in the D.C. metro area was estimated at 7.5% on average in the three months ending in May—close to pre-pandemic levels—according to local unemployment rates calculated using the monthly Current Population Survey. That compares with 9.4% for the group nationwide and an overall unemployment rate in the U.S. of 5.8% in the same period.

Bloomberg has calculated local unemployment rates by race and ethnicity for more than a dozen U.S. metro areas and will be updating those monthly throughout 2021—as well as analyzing data on housing, PPP loans, business openings, spending patterns and job postings—to track the country’s multi-speed recovery.

The jobless rates across these metro areas range from 4.2% or lower for White people in Atlanta and Washington, D.C., to more than 12% for Black people in Chicago and Houston.

While some groups are roughly back to March 2020 levels, like White San Antonians and Hispanic Chicagoans, others continue to face significantly tougher labor markets, such as Hispanic workers in the LA metro area, White people around Las Vegas, and Black New Yorkers.

The stability of government jobs appears to have played a big role in holding up the labor market in D.C., and Black workers have been heavily represented in the federal labor force.

Government jobs account for a significant share of the wages and salaries in the District. And that doesn’t count the additional roles that spin off from the nation’s agencies such as contractors, consultants, lawyers and lobbyists.

Many of those workers were able to work from home during the pandemic. Roughly half of adults in the D.C. region were working remotely at the end of May, according to the Census Household Pulse Survey, more than any other metro area. While the good-paying jobs went virtual, Mayor Bowser said, getting back hospitality jobs is a priority now.

That goal may not come easily, said Mike Curtin, chief executive officer of D.C. Central Kitchen, which serves meals around the city to those in need. During the pandemic, many hospitality workers left the area or the industry for places with a lower cost of living or they found work outside of the city, he said.

While D.C. is outpacing many metro areas analyzed by Bloomberg, the tale of two recoveries even here is apparent.

Tent cities have proliferated as Covid-19 ravaged communities and shut down businesses. Federal Reserve Chairman Jerome Powell in April pointed to one on his commute home from the city center as a barometer of leaving no one behind in the recovery.

Part of the struggle for many is tied to the city’s growth. The minimum wage in D.C. is $15 an hour, and scheduled to increase to $15.20 in July. “But how are you going to get an apartment and support yourself and live in the Washington area on $15?” Curtin said.

As housing prices rise and some emergency-aid programs are set to expire, those who work with the most vulnerable in the city worry about what comes next.

“We’re all afraid of when the eviction moratorium will finally end,” said Stuart Allen, chief development officer at N Street Village, a shelter for women in the District. “That’s a very big concern we have for the fall.”

Mayor Bowser said Tuesday that the city has enough pandemic-relief funding to take care of the debt for those behind on their rent. The hurdle may be connecting the money to people who need it.

“There could be a sticky few months,” she said.

Editors: Margaret Collins, Silvia Killingsworth and Alex Tribou
Assistance from: Cécile Daurat
Photo editors: Farah Shulman, Marie Monteleone and Maria Wood
Lede photograph: A mural with prominent Black figures is seen in the parking lot of a Safeway in Washington, D.C. Eric Lee/Bloomberg

Sources:
Black population share: 2015-2019 5-year American Community Survey (U.S. Census Bureau), taking into consideration the margin of error

Median household income: 2015-2019 5-year American Community Survey (U.S. Census Bureau)

Typical home value: Zillow, data are for May 2021

Year-over-year home price change: Zillow, data are May 2021 vs a year ago

Home equity stake: ATTOM Data Solutions, data are for Q1 2021

Average federal share of employment: Quarterly Census of Employment and Wages (Bureau of Labor Statistics), data are for 4Q 2020

Average federal and private wages: Quarterly Census of Employment and Wages (Bureau of Labor Statistics), data are for 4Q 2020

Black unemployment: Bloomberg analysis of Current Population Survey Data (Bureau of Labor Statistics/U.S. Census Bureau) through May 2021 from IPUMS-CPS, University of Minnesota, www.ipums.org

Unemployment by ward: D.C. Department of Employment Services, data are April 2021 estimates

Covid-19 cases by ward: D.C. Health (using 2018 ACS ward population estimates), data are through June 18

Methodology: For zipcode-level data, each zipcode’s majority race or ethnicity is based on the relevant lower-bound value from the 2015–2019 5-year ACS (estimate minus margin of error). For additional information on the methodology used to calculate local unemployment rates by race or ethnicity, see a more detailed explanation from the first story in this series.

Race &Recovery In a City Split Along Race, Black D.C. Workers See Strong Economic Recovery

Bloomberg is tracking the economic recovery in minority communities across the country

Where the Pandemic Hit Hardest

Race &Recovery

In a City Split Along Race, Black D.C. Workers See Strong Economic Recovery