REPORT: Civil Rights Struggle for True Full Employment

NEW YORK, NY — The concept of full employment, an indicator at the heart of the economy, has been distorted since the 1970s. The term often refers to generally low overall unemployment rates—the rate that economists and policymakers believe will prevent inflation—rather than zero involuntary unemployment.

In a new Roosevelt Institute brief, “The Civil Rights Struggle for True Full Employment,” David Stein, fellow, and Ira Regmi, program manager for Macroeconomic Analysis at the Roosevelt Institute, examine the role of the civil rights movement in laying out the vision for true full employment, fighting to prevent and explicitly prohibit strategies that favor inflation reduction over curbing unemployment. Today, the repeated violations of full employment in law and in principle have kept us from fully realizing the gains from labor victories and have continued to perpetuate inequalities between Black and white workers. 

“A whole-of-government approach is needed to realize this vision of full employment, including robust antidiscrimination enforcement alongside permanent public works programs and a federal jobs guarantee as part of a holistic industrial strategy,” Stein and Regmi write. “Without a commitment to public investment for the public good, we risk repeating the errors that have made the status quo of relative economic health intolerable for Black workers and workers who face discrimination.” 

Toplines from this analysis:

• Full employment is a policy choice that was deprioritized and misdefined, leading to a long-standing conflict between two opposing definitions of “full employment”: the “true” full employment tradition, rooted in anti-racism and other progressive values, and the NAIRU (non-accelerating inflation rate of unemployment) tradition, which diluted the meaning of full employment and emphasized it as a purely quantitative ideal. 
• Better defining full employment to encompass an end to involuntary unemployment, emphasizing not only job availability but also the quality and dignity of those jobs, was central to the work of civil rights activists from the 1940s to the 1970s. These struggles shaped the concept of full employment and culminated in the Humphrey-Hawkins Act of 1978, which clarified the dual mandate of the Federal Reserve to control inflation and maximize employment. 
• Regardless of the definition, Black Americans have, at best, experienced only a single month of full employment since the 1950s. 
• The past few years have seen robust conversations around the labor market, and we must hold two emerging truths together: 1) Buoyed by the power of a large fiscal policy response to the pandemic—the American Rescue Plan and the Inflation Reduction Act—the economy is as strong as it has been in a generation. 2) There is still a significant way to go in achieving the economic vision of true full employment that the civil rights movement fought for. 

To read more from this analysis, click here, or to speak to the coauthors, please reach out to media@rooseveltinstitute.org.

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The Roosevelt Institute is a think tank focusing on corporate and public power, labor and wages, and the economics of race and gender inequality; advancing progressive policies that bring the legacy of Franklin and Eleanor Roosevelt into the 21st century.