Racial Inequality in Men's Employment and Retirement Earnings

Abstract

Data from the New Beneficiary Study for currently married men who began receiving social security benefits in 1980–1981 indicate that the racial earnings gap is greater in retirement than it was in employment. Racial differences in employment and pension earnings are specified by education and employment status. There is, however, a significant net racial effect in predicting social security earnings. Furthermore, education interacts with race in predicting asset earnings, which constitute the major source of racial inequality in retirement. This analysis highlights not only the enduring problem of poverty for African Americans and Latinos who are “working off the books,” without social security benefits, but also the possibility of a “glass ceiling” that limits access to assets for highly educated nonwhites.