Source: Equal Employment Opportunity Commission

The Stunning Economic Impact of the Civil Rights Movement

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Feb. 13 (Bloomberg) -- The civil-rights revolution of the 1960s is now firmly embedded in American civic culture, an inspiring story of courage in the face of violent oppression and age-old injustices finally set right.

Less well-known is that the demand for economic justice was one of the most successful and enduring features of that movement.

Clearly there was an economic dimension to the campaigns for equal treatment of blacks as consumers, with boycotts of downtown business districts targeting lunch counters, movie theaters, hotels and amusement parks.

Just as prominent were demands for “responsible jobs” that had long been denied to blacks, no matter how large the black share in the local population or consumer base. Fliers urging consumers to boycott businesses that refused to employ black workers were circulated during public-accommodation disputes throughout the South.

In industrial settings, black workers fought for decades against segregated promotion lines that denied them access to higher-paying skilled and supervisory positions -- if they weren’t excluded from an industry entirely, as was mostly true in the case of textiles.

‘The Change’

Federal legislation outlawing discrimination in employment and voting had a dramatic effect on this situation, starting in 1964. The share of black employees at South Carolina textile companies jumped from less than 5 percent in 1963 to more than 20 percent in 1970 and to more than a third by 1980. Similar patterns were observed in all the Southern textile states. According to oral histories, blacks in textile areas referred to integration as “The Change,” and associated it with the reversal of black regional migration in the 1960s and ’70s.

Although the industry later declined in response to global competition, desegregation of textiles was the single-largest contributor to the sharp increase in relative black incomes from 1965 to 1975, an exclusively Southern regional phenomenon, according to economists John Donohue and James Heckman. Not only did black living standards improve, but mill workers with limited schooling were often able to send their children to college, taking advantage of expanding educational and employment opportunities elsewhere in the region.

Gains in other sectors were longer in coming and often required protracted litigation. But the basis for political and legal mobilization was almost always in civil-rights legislation. The Supreme Court’s Griggs decision of 1971 arose in the aftermath of the Civil Rights Act, from a complaint by long-segregated black laborers at Duke Power Co. By invalidating racially biased testing, the court forced corporate employers to re-examine their internal systems for hiring, transfer and promotion.

The advent of affirmative action in corporate America is well-known. Less often recognized is that advances for black workers in skilled and white-collar employment were overwhelmingly concentrated in the South, and that these gains persisted through marked changes in the national political climate.

The Voting Rights Act of 1965 had an immediate impact on black-voter registration, and the number of black elected officials increased gradually over the next 30 years. By this measure, too, gains in the South far exceeded those in other parts of the country, even allowing for regional differences in racial demography. Political representation translated into real economic gains for black Southerners, indicated by the distribution of public services, access to public-sector employment and racial equity in the allocation of government contracts.

Economic Watershed

Even public-school desegregation, often derided today as a misplaced priority or an outright failure, has had lasting economic benefits, according to recent research. Long-term studies by economists Sarah Reber, Orley Ashenfelter, William Collins, Albert Yoon and Rucker Johnson have found that Southern school integration increased blacks’ graduation rates, test scores, earnings and adult health status, while reducing the probability of incarceration.

It is difficult to identify precisely what led to these results (whether it was increased resources, better teachers or peer effects) and to differentiate the impact of schooling from that of expanded job opportunities for black graduates. But these complex interconnections only confirm that the civil-rights revolution was an economic watershed.

A striking feature of that revolution is that, for the most part, economic gains for black Southerners didn’t come at the expense of white Southerners. At no time during this era did average white incomes fall as black incomes rose. Nor did Southern whites’ graduation rates and test scores drop after desegregation; instead these indicators continued their long-term progress toward national norms.

What we see, in other words, is not a redistribution in the name of historical justice, but an integration of black workers into the regional economy. When we consider that the civil-rights movement opened the South to inflows of capital, creativity and new enterprises from around the world, it becomes clear that most white Southerners were also long-term beneficiaries of this revolution.

This record may be difficult to appreciate as the country struggles to recover from a severe recession, which hit both the South and blacks disproportionately. But current economic struggles are all the more reason to remember the historic lesson that interracial cooperation has benefits for all concerned.

(Gavin Wright is the William Robertson Coe professor of American economic history at Stanford University. His book “Sharing the Prize: The Economics of the Civil Rights Revolution in the American South,” will be published by Harvard University Press this month. The opinions expressed are his own.)

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