Black Women Are Struggling Most as the Economy Slows and DEI Efforts Decline

Black Women Are Struggling Most as the Economy Slows and DEI Efforts Decline

The U.S. economy has been slowing for months. Prices for everyday goods remain high, interest rates are still up, wages aren’t growing, and many families feel the financial strain. While this affects almost everyone, Black women are facing the biggest challenges—and may feel the impact for years.

In 2024, Black women were reaching new heights in work participation. Jobs in education, public service, health care, and other sectors were in high demand. Black women were earning degrees at record rates, starting businesses faster than other groups, and working at some of the highest levels among all women. For a while, it seemed like real progress was happening.

But today, that progress is slowing.

Many Black Women Are Leaving the Workforce

Since January, large numbers of Black women have left their jobs or lost employment. Economists call this trend “alarming” and “unprecedented.” Unemployment among Black women is rising faster than for men, white women, or Latina women. The industries where Black women have often worked—like public schools, government jobs, health care, childcare, retail, and hospitality—are cutting back, reorganizing, or pausing hiring.

Put simply, the jobs that have long supported Black women are disappearing.

The economic slowdown explains part of this, but there is also a deeper issue. Policies and organizational changes are making the situation especially hard for Black women.

DEI Rollbacks Make the Problem Worse

At the same time the economy slows, government agencies and many companies are reducing their diversity, equity, and inclusion (DEI) efforts. Universities face funding threats if they pursue DEI work. Many large corporations and agencies have paused hiring programs for underrepresented groups or removed DEI policies.

A recent study found that the current federal administration is the least diverse in decades, with most appointees being white men. For Black women—who often rely on public-sector jobs for stable, middle-class careers—this is a serious problem.

When leadership is less diverse, it affects hiring, workplace protections, contracting, and the networks that help women of color advance. During a weak economy, these changes make the challenges facing Black women even more serious.

A Perfect Storm of Economic Pressures

Black women are being hit hardest by the economy for a simple reason: they are overrepresented in jobs that get cut first during downturns. Public services tighten budgets. Schools lay off staff. Hospitals cut support roles. Retail and hospitality slow hiring. When all of this happens at once, Black women—who make up a large part of these workforces—bear the brunt.

The situation is made worse by a recent decision from the US Department of Education: Nursing will no longer qualify for certain federal loans. This will likely reduce opportunities for recruiting nurses of color from working-class backgrounds, who are still less than 10% of nurses in the U.S.

Longstanding inequalities also play a role. Black women earn much less than white men for the same work. They have less household wealth, meaning smaller financial cushions during unemployment. They are more likely to be single parents or caregivers for children, aging parents, or other family members.

This combination—high work participation, low pay, limited savings, and heavy household responsibilities—creates what economists call a “triple economic tax” on Black women:

• The Pay Tax – earning less for the same work

• The Care Tax – carrying more family responsibilities

• The Safety Tax – facing higher risks of housing problems, healthcare gaps, and financial insecurity

When the economy slows, these overlapping pressures become overwhelming.

Backlash Meets Reality

Opposition to DEI (Diversity, Equity, and Inclusion) policies doesn’t happen in isolation. It happens in an economy where gains from 2020–2022 have disappeared, and where Black women—despite being highly educated and entrepreneurial—face shrinking opportunities.

DEI is more than a social goal—it’s a workforce strategy. It helps ensure fair hiring, advancement, and retention. It puts talented workers of color into leadership paths, supports equitable business practices, and creates inclusive workplaces that reduce turnover. It strengthens the middle class.

When DEI programs are cut during a downturn, the damage multiplies. Economic decline worsens, upward mobility stalls, and industries become less representative of the people they serve. For Black women, who already face barriers, the absence of DEI is felt immediately.

Why This Matters for America’s Economy

Black women are not a small or marginal group. They are a key part of the workforce, providing stability in volatile job markets and driving entrepreneurship and higher education. Their economic well-being affects the entire country.

When Black women leave the workforce:

• Families lose income

• Communities lose stability

• Small businesses lose customers

• Employers lose talent

• States lose tax revenue

• The national economy loses one of its most reliable sources of labor and spending

Ignoring this is not just unfair—it’s expensive. The U.S. cannot afford to leave behind the workers who consistently support its economic strength.

The Path Forward

Policies like better childcare access, protecting public-sector jobs, restoring DEI programs, supporting small businesses, and raising wages in caregiving and education are not optional—they are essential.

For the economy to recover fairly and strongly, Black women must be part of the recovery, not its victims. America has faced recessions before, but it has never recovered by leaving its most essential workers behind.

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