Our colleagues at Prosperity Now prepare an annual Scorecard on the state of economic inequality. The Scorecard is “a comprehensive resource for data on household financial health, racial economic inequality and policy recommendations to help put everyone in our country on a path to prosperity.” It recently became available at the local level for cities, counties, congressional districts, metro areas, and tribal areas.
We pulled two reports for California: state-level outcomes and policy measures.
The main finding from the Scorecard’s California profile is that California ranks 15th on the prosperity of its residents compared to the 50 states and the District of Columbia. This rank is based on states’ performance on economic measures for all residents and accounts for racial disparities.
Relative to other states, California’s performance is average for residents overall, while the gap between White residents and residents of color is prominent. The disparities by race are significant and have negative implications for the people and prosperity of California. For example, the homeownership rate of White households is 63% compared to 34% for Black households and 44% for Latino households. Many small business entrepreneurs use their household equity to jumpstart their businesses.
The state policy report includes 29 policies organized into 19 groups. States are assessed based on whether they have adopted each policy during the 2020 calendar year. California has adopted policy well in the Business and Jobs category, with all four categories adopted. On the other hand, California struggles with Homeownership & Housing categories, with only 3 of 7 policies adopted; thus highlighting that California does not offer direct lending programs to first-time homebuyers.
When it comes to microbusiness, California has a 19.9% microenterprise ownership rate in comparison to the United States average of 18.2%. Breaking down business ownership by race, 24% are white owned, 15% for people of color, 18% black, 29.5% American Indian, 24.9% Asian and 11.9% Latino owned. The state had a 4.1% unemployment rate overall in 2020 compared to a 3.7% average in the United States.