The differential effects of output shocks on unemployment rates by race and gender

This article employs a recently developed time-series econometric technique to examine the magnitude and persistence of unanticipated changes in real output on unemployment rates by race and gender. Through the use of generalized impulse response analysis, we measure the extent to which the behavior of unemployment rates of white males, black males, black females, and white females differ in response to real output shocks. The results suggest that, while real output growth reduces the unemployment rate of all demographic groups, the effect is larger and more persistent for blacks than whites and for males than for females. The findings are particularly important for understanding the demographic impacts of policy initiatives aimed at inducing changes in real output growth.