5 Reasons The Government Shut Down is Hitting Black America Harder


The government shutdown is not about race. However the effects are having a crucial racial impact.

Here are 5 reasons why:

  1. Government Employment Black families have been seeking out government employment for generations due to perceived job security, and handsome benefits. As a result African Americans hold the highest percentage of civilian positions with the federal government. Thus are most likely to be furloughed.

  2. Contracts and Cash flow African American small business owners are the largest applicants and recipients of SBA loans. These funds are often used to fund small businesses that don't have adequate cash flow to grow. African Americans business owners secure more government contracts through minority business programs than other ethnic groups. A prolonged government shutdown puts these small businesses in jeopardy of having shut their doors along with the government.

  3. Reimbursement Small black owned grocery stores are having to stop accepting EBT and SNAP payments sooner because this is a reimbursement program. If they accept EBT and SNAP payments this month they risk not getting reimbursed next month and could go out of business because budgets and margins are already tight.

  4. Savings Deficit The Average savings for a middle class black family is $1000.00 while a white family has $7140.00 According to businessinsider.com. With a prolonged shutdown the liquid savings is not substantial enough to make ends meet for major bills or household expenses.

  5. Single Family Income Black America is more likely to live in a single income household. If the only income comes from a federal government job the whole house falls.



This is an indicator of the black wealth position. Wealth is a safety net. Wealth accumulation is all about creating a pool of assets that can take care of you when you can't, or in this case, the government can't take care of you. This is why having a 3 to 6 months safety net savings is crucial. We must be swift to correct this issue in black american wallets. Through proper financial planning and early education we can overcome the racial wealth disparity we face.

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Graphic Reference: http://www.theblackinstitute.org/cap_the_impact_of_the_government_shutdown_on_people_of_color

https://www.businessinsider.com/how-much-the-average-american-has-in-their-savings-account-2018-2

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