The U.S. economy would be $8 trillion larger by 2050 if the country eliminated racial disparities in health, education, incarceration, and employment, a report from the W.K. Kellogg Foundation and Altarum, a nonprofit organization dedicated to transforming health and health care, finds.
The report, The Business Case for Racial Equity: A Strategy for Growth (44 pages, PDF), suggests that gains from eliminating racial disparities in America would be equivalent to a .05 percent boost in GDP annually and would increase the competitiveness of the country for decades to come. An update to a 2013 report, the latest analysis projects significant increases in the level and quality of employment as well as consumer spending if organizations were to take steps needed to advance racial equity. According to the analysis, better jobs, health care, and education for people of color would result in an additional $109 billion spent on food purchases, $286 billion on housing, $147 billion on transportation, $44 billion on entertainment, and $30 billion on clothing and apparel annually. In addition, federal tax revenues would jump by $450 billion while state and local tax revenues would increase by some $100 billion.
What's more, if racial disparities in health care were eliminated, the study estimates total savings of $93 billion in excess medical costs as well as $42 billion in untapped productivity gains. According to the report, more than 25 percent of the growth in the economy's productivity between 1960 and 2008 was associated with a reduction in the opportunity barriers faced by African Americans and women.
"To remain competitive in a global economy, we need the full creative and economic potential of all our people," said Ani Turner, co-director of Sustainable Health Spending Strategies at Altarum and lead author of the report. "Greater racial equity will not only improve individual lives, it will increase the size of the economic pie for everyone."