Newark, New Jersey, April 25, 2017 -- Today, the New Jersey Institute for Social Justice (the “Institute”) released a new report, “Bridging the Two Americas: Employment & Economic Opportunity in Newark & Beyond.” Please click here to read the report, here to read the policy brief, and here to read the two-page fact sheet.
“Fifty years ago this month, Dr. Martin Luther King, Jr., looked to Newark and other urban communities and explained that the country consisted of ‘two Americas,’ divided by race,” said Ryan P. Haygood, Institute President and CEO. “Fifty years later, perhaps no other city embodies both the reality of the two Americas and the possibility of bridging these entrenched divides more than the city of Newark. On one hand, as a testament to Newark’s economy, the majority of the people employed here earn more than $40,000 each year. But the poverty rate for Black residents of Newark is a striking 33 percent, more than double the national average for all races. This is part of a broader, troubling picture: Newark residents, incredibly, hold only 18 percent of all jobs in the city. As our report explains, our cities hold incredible promise to advance progressive solutions to finally bridging the two Americas. The solutions to the enduring problem of economic inequality will have to come from the ground up in our cities.”
Among the report’s findings:
- Newark residents hold only 18 percent of all jobs in the city. This makes Newark an outlier among similarly-situated cities. In New Orleans, local residents hold 46 percent of jobs; in Baltimore, local residents hold 33 percent of jobs; in Detroit, local residents hold 25 percent of jobs; and in Cleveland local residents hold 24 percent of jobs.
- While almost three-quarters of Newark residents are people of color, 60 percent of the people employed in Newark are white. Just 31 percent of the people employed in Newark are Black and only 20 percent are Latino.
“These disparities in employment cannot be explained by Newark residents not wanting to work, as people of color in Newark have a higher labor force participation rate than both the nation and the State of New Jersey,” said Demelza Baer, Institute Policy Counsel and the report’s primary author. “These disparities are systemic failures that require systemic solutions. At the most basic level, there are not sufficient career pathways for local residents to obtain middle-skill jobs in Newark. These disparities also reflect the accumulation of decades of law and policy decisions at the federal, state, and city level, structural changes in the economy, and discrimination that limited economic opportunity and made it more difficult for people to connect to work. This report seeks to change that reality.”
The report also found that:
- The majority of people working in Newark (56.4 percent) earn more than $40,000 annually, even as one-in-three local residents live below the poverty line.
- In comparison with non-Newark residents, local residents hold 26 percent of jobs paying less than $15,000 annually in Newark and 28 percent of jobs paying between $15,000 and $40,000 per year, but only 10 percent of jobs paying more than $40,000 annually.
- Despite having a higher labor force participation rate, people of color in Newark have the highest unemployment rates, with Black residents experiencing an unemployment rate double that of white residents.
- Newark residents commute long distances for work at a great financial and time cost. Among employed Newark residents, 60 percent of them commute to other counties in New Jersey and New York for employment, and most of the employed Newark residents (61.9 percent) drive to work. About one-fourth (26.4 percent) of employed Newark residents rely on public transportation for work, with nearly half of them (48.3 percent) having a commute of at least 60 minutes.
The report provides a Blueprint for connecting residents with work that pays a living wage through public and private partnerships.
Among the Institute report’s primary recommendations:
- Strengthen Newark’s First Source Ordinance
- Raise the Minimum Wage in New Jersey to $12 an hour immediately, with an expeditious phase in to $15 an hour
- Strengthen the Opportunity to Compete Act (also known as the Ban-the-Box law)
- The New Jersey State Legislature should conduct a holistic analysis of the over 1,000 collateral consequences under state law, including the over 600 employment-related restrictions, in order to repeal those that are not necessary for public safety.
Newark is at the forefront of this work with Mayor Ras Baraka’s Newark 2020 initiative, an unprecedented partnership with the Institute, the Newark Alliance, Rutgers University-Newark, RWJ Barnabas Health, Prudential, and other anchor institutions, employers, community development corporations, and community leaders, which aims to connect 2,020 unemployed Newark residents to local employment that pays a living wage by 2020, thereby cutting the gap between the city and state’s unemployment rate in half.
“The Institute’s report speaks to the urgent need for good job opportunities for city residents, who only make up 18% of our city’s workforce and are concentrated in the lower-paying jobs in the city,” said Mayor Ras Baraka. “In order to powerfully connect more local residents with jobs that pay a living wage, I will be launching, in partnership with the Institute, the Newark Alliance, Rutgers University-Newark, RWJ Barnabas Health, Prudential, and a host of other employers, Newark 2020 in June. Newark 2020 will connect 2,020 unemployed local residents with full-time jobs by 2020 in order to cut in half the gap in the unemployment rate between the City of Newark and the State of New Jersey. Newark 2020 is an unprecedented initiative in the City of Newark, bringing together the city's business community, higher education and medical institutions, non-profits, clergy, philanthropies, and workforce development programs to reduce poverty and unemployment and strengthen the city's economy by the beginning of the next decade.”
“It is a business necessity to hire locally and pay employees a living wage,” said Kimberly McLain, Chief Executive Officer of the Newark Alliance. “This is not about charity. These policies provide employers a competitive advantage by ensuring that they benefit from Newark’s local talent who are connected to and invested in our community. We need to empower Newarkers to not only survive, but thrive, through innovative solutions that meet the needs of residents, and businesses alike.”
Both RWJBarnabas, Rutgers University-Newark is committed to providing employment for many Newark residents, and to hiring even more people for full-time positions through Newark 2020.
"Investing in the people of Newark, hiring locally, and paying our employees a living wage strengthens both the community and RWJBarnabas,” said Michellene Davis, Executive Vice President of RWJBarnabas Health. “RWJBarnabas Health has witnessed and believes in the benefits of the business case of employing these strategies first-hand.”
Under Chancellor Nancy Cantor’s leadership, Rutgers is actively working with other local colleges and the community to increase the percentage of Newark residents who have college degrees, certificates, and other high quality credentials to 25% by the year 2025. This initiative—the Newark City of Learning Collaborative—is also a partner for the Mayor’s Newark 2020 initiative.
Rutgers University-Newark also offers free tuition and fees for Newark residents who are admitted and have a household income of $60,000 or less.