UNC Study: Blacks Add Nearly $45 Billion to State's Economy
Posted November 13, 2007
Raleigh, N.C. — A recent study shows blacks in North Carolina contribute more than $44.7 billlion to the state's economy through their purchases and taxes.
The study, "The Economic Impact of the African-American Population on the State of North Carolina," said if growth trends continue, the total economic impact of blacks' spendings in the state could increase to $60 billion by 2009.
The report, conducted by the Frank Hawkins Kenan Institute of Private Enterprise, also shows black residents cost the state budget $4.5 billion for health care, education and corrections. It follows the institute's January 2006 report on the economic impact of the state's Hispanic population.
"This study shows that clear opportunities exist for financial institutions and other businesses to capitalize on this growing market," said Andrea Harris, president of the North Carolina Institute of Minority Economic Development, major funder of the study. "It also offers recommendations for expanding economic opportunity and impact."
Among the findings of the study, which used 2004 and 2005 data for analysis:
- North Carolina's African-American population totaled 1.8 million, or 21.8 percent of the state's total population, and accounted for 20.4 percent of the state population growth from 1980 to 2004.
- Forty-two percent of the African-American population is concentrated in six metropolitan counties: Mecklenburg, Wake, Guilford, Cumberland, Durham and Forsyth.
- The state's African-American population is substantially younger (median age 32) than the state's white population (median age 39).
- African-Americans are less likely than whites to live in nuclear families (41.1 percent versus 70.1 percent) and more likely to live in single-parent families (42 percent versus 11 percent).
- African-American households (average size 3.3 persons) tend to be larger than white households (average size 3.0 persons).
- African-Americans accounted for 29.3 percent of the state's overall workforce increase between 1995 and 2005, with two sectors - education and health services (118,522) and leisure and hospitality services (71,034) - absorbing the largest increases of workers.
- The median education level for both blacks and whites is a high-school diploma. However, a $19,570 difference exists between the two groups in median household income and an $11,970 difference exists in per-capita income.
- Racial disparities in earnings and income are due primarily to the fact that blacks are more likely than whites to be concentrated in low-paying occupations within North Carolina industries.
- The share of African-Americans incarcerated in North Carolina
(59.4 percent of all people incarcerated in the state) is nearly three times their share of the state's total population (21.8 percent).
- African-Americans annually pay $3.8 billion in state and local taxes (direct and indirect), while costing state and local budgets about $4.5 billion annually for K-12 education ($2.7 billion), health care ($1.3 billion), and corrections ($453 million), for a net cost to the state of about $759 million, or approximately $420 per resident after their tax contributions are considered.
Researchers said there were three areas of opportunity to expand blacks' economic impact in the state – helping black-owned businesses capitalize in the global economy, providing entrepreneurial training and support for ex-offenders and improving K-12 education.