Race and Ethnic Diversity in Oregon’s Workforce
January 22, 2024Oregon’s population is less racially and ethnically diverse than the nation as a whole. According to the U.S. Census Bureau’s 2020 Diversity Index, Oregon ranked 30th out of 51 states and Washington D.C. in racial and ethnic diversity. Black exclusion laws implemented in the mid-19th century have impacted Oregon’s current demographics. As the Oregon Encyclopedia notes, “these laws, all later rescinded, largely succeeded in their aim of discouraging free Blacks from settling in Oregon early on, ensuring that Oregon would develop as primarily white.” While the state has diversified considerably since its founding, there is only a 46.1% chance that two Oregon residents chosen at random will be from different race or ethnicity groups compared with 61.1% nationally.
With the exception of Asian workers, people of color in Oregon’s workforce face higher unemployment rates and earn lower wages than white workers and tend to work in lower-paying industries. People of color are broadly defined here as individuals who identify with a race other than white. This group includes Oregonians who are Black or African American, American Indian or Alaska Native, Asian, Native Hawaiian and Other Pacific Islander, some other race, or two or more races.
Oregon is Increasingly Diverse
Though it is still predominantly white, Oregon’s population has become more racially diverse in recent years. According to the American Community Survey (ACS), people of color made up 21.3% of Oregon’s population on average between 2018 and 2022. Nationally, people of color accounted for 34.1% of the population, more than 10 percentage points above Oregon’s share. The share is up 6 percentage points from Oregon’s 2017 five-year average of 15.1%.
Oregonians who identified with two or more races made up the fastest growing racial group in 2022, increasing by 111.4%. The proportion of Oregonians who identified with some other race also grew considerably, increasing by 49.2%. Oregon also grew more ethnically diverse during the same period. The number of Hispanic or Latino Oregonians increased by 14.4% between the 2017 and 2022 averages.
About one out of 10 adults living in Oregon were foreign born on average from 2018 to 2022, according to the American Community Survey. The largest share of foreign-born adults living in the state are Hispanic or Latino (40.5%). However, Oregon’s Asian population has the highest proportion of foreign-born residents. Nearly two-thirds (62.4%) of Oregon’s Asian residents were foreign-born. Other groups with relatively high proportions of foreign-born residents include adults who identify with some other race (35.9%), who are Native Hawaiian or other Pacific Islander (31.0%), and who are Hispanic or Latino (28.7%).
Diversity Varies by County
The racial and ethnic diversity varied among Oregon’s counties. Jefferson County had the highest percentage of respondents identifying as people of color. More than one-third (34.8%) of respondents reported a race other than white. American Indian and Alaska Natives were the second highest racial category behind white in Jefferson County, making up 13.1% of the total population, the highest of any Oregon county.
Washington County had the second highest percentage of people of color in Oregon at 31.3%. The second largest racial group besides white in Washington County was Asian residents, who made up 11.0% of the total population. This was the highest concentration of Asian residents in any county in Oregon. Morrow County had the third highest percentage of people of color at 30.0%. Oregonians of two or more races was the second highest racial group in Morrow County. Other counties where people of color made up more than a quarter of the population included Marion County (28.4%) and Multnomah County (27.6%).
In six Oregon counties, around a tenth or less of the population were people of color during this period. Baker County had the smallest proportion of people of color in its population at 9.1%. The other five counties were Wallowa (9.7%), Union (9.8%), Crook (9.9%), Grant (10.0%), and Deschutes (10.2%).
Employment Status Varies by Race and Ethnicity
People of color collectively have higher labor force participation rates than white residents in Oregon. According to ACS 2022 five-year estimates, people of color had a labor force participation rate of 67.8%, over 6 percentage points higher than the white working-age population. Those surveyed that identified as some other race had the highest labor force participation rate at 72.4%, followed by Native Hawaiian and Other Pacific Islander at 70.4%. White Oregonians had the lowest labor force participation rate at 61.0%.
Labor force participation rates also varied substantially by ethnicity. Hispanic or Latino Oregonians had a much higher participation rate (73.1%) than non-Hispanic whites (60.3%). One possible explanation for this difference is the median age difference between ethnic groups. Non-Hispanic whites tend to be older than Hispanics. According to the ACS five-year 2022 estimates, Hispanics or Latinos in Oregon had a median age of just under 27. During the same period, non-Hispanic whites had a median age slightly over 44.
Unemployment also varies by race and ethnicity. People of color had a higher average unemployment rate than the white labor force in 2022 at 6.4% compared with 5.4%. This may be due in part to higher rates of labor force participation. Higher labor force participation can be correlated with a higher unemployment rate because more job entrants and fewer discouraged workers can increase temporary frictional unemployment.
Yet different labor force participation rates cannot fully explain variation in unemployment rates by group. Despite their relatively low labor force participation (61.9%), American Indians or Alaska Natives experienced the highest unemployment rate at 8.3%. White Oregonians had a similar participation rate (61.0%), but a much lower unemployment rate.
Earnings, Industry of Employment, and Education Follow Similar Trends
During this period, Oregon’s Asian residents had the highest earnings among full-time, year-round workers, with a median annual income of $70,700, followed by white workers with median earnings of $60,400. Median annual earnings for workers of all other racial and ethnic groups ranged between $42,300 and $50,300 – at least $10,000 less than white workers and $20,000 less than Asian workers.
The wage disparity was due, in part, to the industries of employment for each racial and ethnic group. Except for Asian workers, health care and social assistance was the largest industry of employment for all racial groups. This industry had median annual earnings of $47,000 on average between 2018 and 2022. Manufacturing, one of the highest paying sectors in the state with annual median earnings of $57,800, was the most common industry of employment for Asian workers, which may help explain Asian workers’ higher incomes.
Differences in other major industries of employment could explain income variation between other racial groups. The second most common industry of employment for people of color is accommodation and food services, which had the lowest annual median wages of any industry during the same period at $21,500. The second most common industry of employment for white workers was retail trade, with an annual average wage of $31,400, followed by manufacturing.
Educational attainment could also contribute to earning disparities. According to the 2022 five-year estimates, 55% of Asians over 25 have a bachelor’s degree or higher, the greatest percentage of any racial group. White Oregonians had the second highest rate of higher education at 36%, followed by 33% of Black or African American Oregonians and 30% of those who are two or more races.
For all other racial groups, less than one-fifth of adults 25 and older hold a bachelor’s degree or higher. Nineteen percent of Native Hawaiians or other Pacific Islanders have a bachelor’s degree or higher, 16% of American Indian or Alaska Natives, and 15% of those who are some other race. Hispanics are also less likely than non-Hispanic whites to hold a bachelor’s degree. Nineteen percent of Hispanics or Latinos have a higher education degree compared with 37% of non-Hispanic whites.
Typically, those with higher education qualify for higher-paying jobs, which also factors into the higher annual average wages for Asian and non-Hispanic white workers. Since the majority of the Asian population in Oregon is foreign-born, our companies may court some of these highly educated workers to fill high-skill, high-wage positions.
Industry and Education Cannot Fully Explain Income Disparity
It’s important to note that even when controlling for educational attainment, some groups still earn lower wages than their equally educated peers. Black or African American people in Oregon and the U.S. earn lower median wages across all levels of educational attainment compared with all other workers. Research from the Federal Reserve Bank suggests that national differences in earnings between Black and white workers are persistent, have grown over time, and can’t be completely explained by factors such as geographic location, age, educational attainment, part-time employment, industry of employment, or occupation.
Gaps in wealth also exist between people of different races and ethnicities. Research from the U.S. Federal Reserve Board found that in 2019, the median net worth of Black families in the U.S. was $24,100, less than 13% of the median for white families ($188,200). The median Hispanic family has $36,100 in wealth as of 2019 or 19% of the wealth held by the median white family. The wealth gap is driven, in part, by large differences in homeownership. In 2020, 45.9% of Black households and 50.1% of Hispanic households owned their homes, compared with 75.0% of white households. The racial and ethnic wealth gap likely widened over the years since this analysis, as real estate values accelerated faster than ever before in the years following the 2020 Pandemic Recession, according to Fannie Mae’s Home Price Index, benefiting existing homeowners.
Conclusion
The majority of economic indicators are consistent for each racial and ethnic group. Groups in Oregon with higher rates of educational attainment tend to be employed in higher-paying industries, and as a result, have lower unemployment rates and higher wages.
As Oregon’s population continues to diversify, these patterns may change. Positive changes may depend on increasing access to education for people of color, creating pathways to employment in higher-wage fields, and pathways to homeownership.
For Oregon employers looking for ways to better support diversity in the workplace, Partners in Diversity offers a variety of resources tailored for employers and professionals of color in the Pacific Northwest.