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Report Shows Poorly Educated Workers at Bottom of So Cal's Broken Economic Ladder

Date Published: December 20, 2011
By focusing on underemployment rates in addition to the numbers of unemployed, this report provides a more accurate measure of the health of the labor market in Southern California and finds a marked increase in the concentration of people clinging to the bottom of the state’s social and economic ladder, with Latino and Black males comprising the economy's hardest hit sectors.

For Immediate Release:   December 20, 2011     

CONTACT:  Gary Orfield: (310) 474-0647 or Kfir Mordechay (310- 420-5422;  



--Los Angeles--It comes as no surprise that Southern California workers have been devastated by the Great Recession and its massive loss of jobs.  But the hit has come particularly hard for those without good educational backgrounds, and most dramatically for Latino and black males.  There have been serious warnings about the economic cost of dropouts and the failure to deliver higher education to the rapidly expanding population of nonwhite youth in California. Now we see the impacts spelled out in statistics of exclusion or marginalization in the job market.

“Now,” says Civil Rights Project Co-Director Gary Orfield, “the collapse of the construction and related job markets, particularly in the once booming Inland Empire, shows us very clearly how high the cost has been for young men and their families and how the toxic combination of the recession and high dropout rates are for the future of our region’s majority.  The small recent uptick in California jobs would have to become much larger and last for years to substantially change the crisis we are reporting.”

A new report shows a much bleaker picture of joblessness and opportunity in Southern California than commonly reported.  By focusing on underemployment rates in addition to the numbers of unemployed, the report provides a more accurate measure of the health of the labor market and finds a marked increase in the concentration of people clinging to the bottom of the state’s social and economic ladder. Southern California, one of the world’s largest and diverse urban complexes, is rapidly becoming a region of profound economic and geographic polarization, according to the study. 

Fragmented Economy, Stratified Society, and the Shattered Dream, by Kfir Mordechay, explores the divergent economic fortunes of skilled and unskilled workers in six counties of Southern California, including Los Angeles, Orange, Riverside, San Bernardino, San Diego, and Ventura. The report offers a unique analysis of the dynamics of job opportunity and inequality in California and focuses on the Southern California region, appropriately named “LASANTI,” which describes the region encompassing Los Angeles County down through San Diego and including the northern frontier with Mexico, including Tijuana.

The report clarifies that the changes to the Southern California economy over the last four years--easily drawn into focus during this time of extreme economic slowdown--are symptoms of an already existing structural problem exacerbated by the recession, not created by it. The report explains that during the past thirty years both technological advancement and global trade have structurally transformed employment status and income.  Furthermore, the report stresses that the differences in economic opportunity in the region tell a story of the challenges we face throughout the nation, not just in California.

The study also makes clear that while the official unemployment rate has been a frequent topic in the mainstream press throughout the economic downturn, the underemployment rate has rarely been discussed at length, even though the number of underemployed workers has increased dramatically. 

According to the study, underemployment is a more comprehensive indicator of the health of the job market and overall economy as it counts three groups of workers: the total number of unemployed people, involuntary part-time workers who want full-time work but have had to settle for part-time hours, and “marginally attached” workers who are available and want to work but have given up actively looking.

By combining data and analyses from a number of expert sources, including the Bureau of Labor Statistics, the Economic Policy Institute, and the Brookings Institution, the research examines wages and work across racial, ethnic, gender, age, education, and geographic boundaries and includes the unique regional impact of Southern California's explosive real estate boom that began in 2000 and culminated in the housing market bust of 2007, along with the subsequent onset of the Great Recession.

The globalization of economic activity has essentially created new domestic jobs for specially trained college graduates while wiping out many opportunities for workers lacking higher education. Individuals from the lowest social rungs, particularly Latinos, African Americans, and those in the lowest educational ranks, not only begin with different opportunities and resources, but often do not have the paths to mobility in the quest for social and economic well-being. This trend of racial and class stratification in terms of employment prospects, earnings, and educational opportunity has been increasing for the last 30 years.


• From 2007-2009, while the unemployment for Latinos increased from 5.7% to 14.3%, the underemployment rates for Latinos in L.A. County have skyrocketed from 11% to 29.2%, by far the most dramatic increase of all races.

• For African Americans without a high-school diploma, the unemployment rate in California is above 31.6%, far higher than any other race or ethnicity African American high school dropouts suffer much more severe unemployment than dropouts of other races.

• Between 2008 and 2009, all job growth from the previous 9 years was lost in Los Angeles County, with manufacturing showing the greatest decline (36.1%) from 1999-2009.

• Over 59% of construction workers live in Los Angeles neighborhoods of concentrated poverty. The ethnic make-up of the construction workers in neighborhoods of concentrated poverty throughout Los Angeles is: 88% Latino, 4% Black, 4% Asian, and 3% white.

• The official unemployment rate for those without a high school diploma increased 5.7% since 2007, compared to 8.8 percent for high school graduates, and 3.6 % for those with a bachelor’s degree. On the other hand, underemployment rates for California workers without a high school diploma have jumped 18.6% since 2007, compared to 14% for high school graduates, and 6.3% for individuals with a bachelor’s degree.

“Today we are in the midst of intense economic forces that are redefining not only the California Dream, but also the American experience,” states Mordechay, a researcher with the Civil Rights Project. “One of the biggest imperatives the state faces in the years ahead is making sure that its schools don’t fail to prepare their students for the challenges of the 21st century.” 

By examining the state of the labor force through calculating underemployment rates, the report provides policymakers and the broader public with a more accurate portrait of the regional economy.

The report concludes with recommendations for building a stronger, more equitable, and resilient economy through customized job training, government investment in infrastructure, targeted tax credits, and addressing educational inequality. 

Click here to access the full report and executive summary.

About The Civil Rights Project at UCLA
Founded in 1996 by former Harvard professors Gary Orfield and Christopher Edley, Jr., the Civil Rights Project/Proyecto Derechos Civiles is now co-directed by Orfield and Patricia Gándara, professors at UCLA. Its mission is to create a new generation of research in social science and law, on the critical issues of civil rights and equal opportunity for racial and ethnic groups in the United States. It has commissioned more than 400 studies, published 14 books and issued numerous reports from authors at universities and research centers across the country. The U.S. Supreme Court, in its 2003 Grutter v. Bollinger decision upholding affirmative action, and in Justice Breyer’s dissent (joined by three other Justices) to its 2007 Parents Involved in Community Schools decision, cited the Civil Rights Project’s research.

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