“Joblessness leads to hopelessness, [and] hopelessness leads to what we see in the streets,” observed Merck’s CEO Ken Frazier, who emphasized the role of Black unemployment in exacerbating the social unrest sparked by the police killing of George Floyd. Maintaining that business has the means to eliminate some of the inequities in society, Frazier challenged business leaders to “step up and solve many of these economic problems.”
Since its founding, Directors & Boards has underscored the paramount importance of employment and the fundamental accountability of companies for creating good jobs. My father, Dr. Milton L. Rock, who preceded me as publisher of D&B, asserted in the mid-1970s: “Business is all about producing jobs as well as products and profits, jobs that preserve the dignity of man…. There will come a time when a company will be judged by the number of jobs that provide livings with which employees can improve their lives.”
In 2009 I thought the time had come. At the height of the Great Recession, I wrote a D&B publisher’s letter entitled “Job One is Jobs Won.” I posited that boards of directors should focus on building businesses that produce good-paying jobs, and I recommended they should hold management accountable through incentive systems that offer rewards for the retention and creation of jobs. Last year, I penned a publisher’s letter entitled “Capitalism’s Success: Creating Jobs,” in which I applauded American companies for having produced a record number of jobs.
The American dream is embodied in meaningful, stable, valuable work. More than just providing a living, a job can provide self-worth, respect and dignity. In early 2020, the U.S. had the best jobs market in over half a century. The 3.6% overall unemployment rate was an all-time low, and the rates for most groups including Blacks, women and high-school graduates were the lowest on record. Moreover, wages were rising faster for the lowest wage earners.
But in just a few months, the United States went from the best unemployment rate in 50 years to the worst since the Great Depression. From mid-March through mid-June, 47 million Americans filed for unemployment benefits. Although job losses in March and April were largely distributed evenly across racial groups, the recovery may not be. Black unemployment tripled from 5.8% in February to 16.8% in May. As often happens, minority employment suffers disproportionately coming out of a recession.
Companies need to step up and meet this challenge by promoting Black employment through enhanced recruitment, internships, hiring, training, mentorships, and career mobility. To help do so, boards of directors need to regularly receive company-wide statistics and metrics detailing employment, pay and promotions by racial and ethnic groups, as well as policies and programs to redress disparities and inequalities.
As companies struggle to recover from the pandemic, directors need to proactively advocate and actively focus on producing jobs that provide dignity, stability and a living wage, particularly for those who come from our most vulnerable communities. Jobs offer hope for a more equitably shared prosperity and a more universally just society.