Ending Economic Discrimination Means Better Old Age for All

A Social Security executive urges retirement professionals to address economic discrimination, particularly for Black women.

By Eleanor O'Sullivan

A U.S. Social Security Administration executive urged retirement professionals to think about the critical role that Black women play as caregivers and develop ways to end the economic discrimination they face.

Dr. Kilolo Kijakazi, a deputy commissioner for the U.S. Social Security Administration, delivered that message to her audience at the Employee Benefit Research Institute-Milken Institute 2024 Retirement Symposium.

“You are getting older by the second, and I am getting older with you. If we are lucky, we will reach an age where we are no longer able to care for ourselves by ourselves; we will need help,” she said. “Some of us will get help from family members, but even if your family can care for you, you will need help from a professional caregiver from time to time. … Our commonality is that when we get old, we very likely will require assistance from a professional caregiver.”

But the problem is that we do not treat our caregivers like valued professionals, said Kijakazi, a deputy commissioner for Social Security’s Office of Retirement and Disability Policy, and a Black woman.

Persistent work inequality

Kijakazi noted long and persistent work inequality affects African Americans in greater numbers than White citizens. Women of color, she said, account for more than half of professional caregivers — 89% of these caregivers are women — and on average, they make “the paltry annual salary of $28,820,’’ most often without benefits.

“I have studied, researched and analyzed Social Security policy since 1997, and what I note is: If we are not economically secure in our working lives, it is very likely that we will not be economically secure when we become elderly,” said Kijakazi. She said her comments were not representative of the current administration or the Social Security Administration.

Education isn’t the solution

She was particularly critical of the “deficit model,” which says if one does not work hard enough or save enough for a secure retirement, then education must be provided for underachievers to attain economic security.

It’s a popular approach, she said, “because it’s easy. It puts all the onus on the individual and it’s low cost. It requires no investment other than the production and dissemination of financial information.”

She said these sorts of admonitions to get more financial education are often directed at Black people. However, studies at schools such as Howard University, Harvard University and John Jay College of the Black experience in the labor market conclude that a lack of financial education is not the root cause of economic disparity in areas such as retirement accounts, Kijakazi said.

Labor market barriers are, such as White job applicants receiving 36% more callbacks after interviews than Black or Latino job seekers, and African American workers typically receiving lower wages than Whites at every level of education in every occupation, she told the audience.

Less access to employer-sponsored accounts

Black workers have had restricted access to what Kijakazi called structural benefits, including employer-sponsored retirement accounts, she said. If two people both save $100 a month for retirement but one did it through an employer-sponsored savings account, that person would have greater retirement wealth, she added.

“This leaves Black women, who often work in the service sector without benefits, and are under-represented in the professional sector, closer to poverty,’’ Kijakazi said.

“Service workers,” she continued, “are half as likely as management professionals to have access to retirement benefits through employers. Social Security helps mitigate some of these effects. But as a result of these lower lifetime wages and lower rates of benefits, and especially of the employer-sponsored matched plans, African Americans are not as likely to be secure when they retire.’’

Focus on employment discrimination

Holding employers in the private and public sectors accountable for workplace discrimination is urgent, she said.

Kijakazi, who served as acting commissioner of the Social Security Administration from 2021 to 2023, urged audience members to read the research and studies on occupational segregation and from these works, devise and propose policy solutions.

“What are you going to do? My admonition is that unless and until you focus on racial, ethnic, gender and other discrimination in employment, we will not succeed in protecting the economic security of Black women and we will be the poorer for it,’’ she said.

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