Native American employment and unemployment (historical trends)

Tribes affected: Pantribal

Significance: Before contact with Europeans, the labor of American Indians served group or tribal purposes; employment and unemployment patterns in the twentieth century reflected the profound disruption of Indian life that occurred following contact.

In the pre-contact period, Indians had extensive trading networks throughout Canada, the United States, and Central and South America. Agricultural goods, manufactured items such as jewelry, pottery, and tanned hides, and natural resources such as seashells were bartered or sold.

Traditional Labor

Labor was required to sustain this extensive trade network, but little is known about how the labor systems were organized. Tribal groups in the Mississippi River area, the southwestern United States, and Central and South America had highly specialized labor forces in which both men and women participated. Division of labor was determined in part by gender, talent, and social position. These societies were organized hierarchically and sometimes incorporated slaves (captives from other tribes), who performed undesirable labor.

Much of North America and Canada was inhabited by nomadic hunting and gathering societies and semisedentary agriculturalists. In these societies, division of labor was based primarily on gender and was less complex, with most tribal members working toward the common goal of providing food, shelter, and clothing for survival. In these subsistence economies, there was little opportunity for members to specialize in any one area, such as art or medicine. Such cultures stressed sharing and egalitarianism as a way to ensure the well-being of the people. Everyone worked for the common good.

Arrival of Europeans

European migration to North America was primarily motivated by economic interests. The first phase of European-Indian relations revolved around the fur trade, which required the incorporation of Indian labor. The early period of the fur trade is marked by relative equality among Europeans and native people. Indian men and women labored to supply processed hides and pelts for the fur trade. In return for their labor, Indians were paid with European trade goods—metal pots, needles, knives, guns, and a variety of domestic goods. During this period, those Indian people who obtained European trade goods would redistribute them among tribal members, thus maintaining the tribal ideal of generosity and sharing. The trade goods changed the work patterns of both Indian men and women. Guns and traps permitted more men to hunt and kill more game, and, in turn, women were required to tan more hides for trade. Indian labor during this period was still directed toward the good of the tribe, but increasingly tribal welfare depended on sources outside the tribe.

The fur trade was an important source of labor for American Indians, but the fur trade period ended as animal populations decreased and as European fashion changed. The decline in the fur trade coincides with the emergence of the United States and marks a period of change in the economic position of Indians. Indians were no longer needed as laborers in the new economy. The European American population was rapidly increasing and there was an increased desire for land. Indians became a hindrance in this emerging economic system. The relative lack of demand for Indian labor, coupled with the high demand for Indian land, caused the U.S. government to remove Indians from areas coveted by European Americans and resettle them on poor lands.

The reservation system was firmly in place by the late nineteenth century, and it caused considerable change in the work patterns of tribal groups. For the most part, hunting and fishing were no longer possible on the restricted land base, and traditional agricultural practices were not viable or were discouraged. The reservation system afforded little opportunity for Indian people to provide adequately for their families and it is directly linked to contemporary reservation poverty.

During the early reservation period, some Indian men worked for federal agents as freight haulers, policemen, and laborers. Indian women sometimes sold pottery, beadwork, baskets, or other small items. Income from these sources was small. Government policy largely confined Indian people to their reservations, so they were unable to sell their labor for wages off the reservations. Federal Indian policy, most notably the General Allotment Act (1887), reduced the Indian land base and subdivided the land among many heirs so that productive use of reservation lands became nearly impossible. High Indian unemployment rates caused gradual loosening of federal policies of confinement to reservations, and by the early twentieth century Indians commonly worked in off-reservation jobs such as laborers on farms and ranches, and in mines. The 1930 census indicates that 80 percent of Indian men were working for wages, mostly in agricultural jobs. Most of this work was unskilled, seasonal, and off-reservation.

The 1930s

In the 1930s, federal Indian policy sought to address the problem of high unemployment and poor economic opportunity on the reservations. A 1928 study, The Problem of Indian Administration, commonly known as the Meriam Report, criticized federal Indian policy that intentionally removed Indian control over lands and resources and contributed to the widespread poverty and unemployment that characterized reservations. Partly in response to this study, the Indian Reorganization Act was passed in 1934. This intended to enable tribes to consolidate severely checkerboarded reservation lands, take out low-interest loans to establish economic ventures on reservations, and encourage farming and ranching opportunities on reservations. The Great Depression prevented any significant business development on reservations; however, a fair number of Indian people benefited through various New Deal programs, particularly the Indian Division of the Civilian Conservation Corps, which employed and trained more than eighty-five thousand Indians in nine years. During the same period, the Bureau of Indian Affairs organized a division to place Indians in off-reservation jobs.

Changes in the Mid-twentieth Century

Thousands of Indians joined the wage labor force during World War II (1939-1945). Many Indian men and women joined the armed services or moved to urban areas to work in war industries. After the war, many Indian people remained in urban centers, while those who returned to reservations began to focus on reservation economic development and employment. Reservations remained poor and unemployment high, however. Few jobs came to the reservations, tribes had difficulty securing loans, reservation laws made business investments difficult, and many reservations were distant from markets. Additionally, off-reservation seasonal farming jobs became scarce with increasing technology. As a result, large-scale Indian urban migration continued after World War II and was encouraged by the federal policy of the 1950s known as relocation. Through the Native American relocation program, Indians were removed to urban areas where jobs could be found. They received job training and housing assistance. The lack of any meaningful jobs on reservations, coupled with federal Indian policy, contributed to unprecedented Indian migration to urban areas from 1950 to 1980. By the 1980 census, more than half the Indian population resided in urban areas. Indians continue to move to cities because of poor economic opportunities on reservations. Urban Indians experience higher employment rates and per capita incomes than reservation Indians. They remain poor, however, with per capita income slightly ahead of urban African Americans and well behind urban whites, and unemployment rates more than double those of the urban white population.

The federal government abandoned relocation programs in the late 1960s and turned its attention to revitalizing reservation economies. Concurrently, tribal governments were strengthened, and tribes began pursuing economic development initiatives independent of the federal government. Success has been mixed, and reservations still have high unemployment and poverty rates.

Modern Labor Force Participation

On the majority of reservations, the largest single source of jobs is government, either tribal or federal. Despite many sincere efforts, there has been little economic investment or growth on reservations, primarily due to lack of resources, capital, location, and a skilled labor force. Few businesses are located on reservations, and unemployment rates are in the 80 to 90 percent range on some reservations. Census figures on the labor force calculate only those who are employed or are actively seeking employment. According to the 1990 census, 62 percent of Indians sixteen years and older were in the labor force (69 percent of the males and 55 percent of the females). Many of the jobs held, however, were seasonal or part-time. A larger number of American Indians than the total population were employed in service jobs: farming, fishing, forestry, construction, or manufacturing. Fewer Indians, as compared to the total population, were employed in managerial or professional specialty occupations. In 1990, the median income of Indian workers was considerably less than that of the total population, and 31 percent of American Indians were living below the poverty level, compared with 10 percent of all American families. According to the 1990 census, 51 percent of the reservation population was living in poverty.

American Indian labor force participation on reservations continues to be low because of a lack of economic opportunities. The Indian population is young and lacks jobs experience. More significant, however, is the education deficit among Indians. Only 56 percent of American Indians graduate from high school, compared to 69 percent of the white population. Urban areas offer more job opportunities, but male Indian labor is largely confined to manual occupations, which are subject to fluctuation because of economic downturns, weather, and other factors. Female Indians are employed primarily in low-skilled, nonmanual service jobs both on and off the reservation.

During the 1980s, some tribal governments managed to attract businesses and increase employment opportunities, but overall, success was limited. Indian gaming, sometimes referred to as “the new buffalo,” is being explored by many tribes as both a source of income for the tribe and as a way to provide jobs. Native American casinos have brought jobs to many reservations, but these tend to be low-wage service positions such as cashiers and waitresses. Tribal governments look to gaming as a way to strengthen reservation infrastructures and improve the lives of the people while they search for other means to address the dual need for Indian employment and real economic development on the reservations.

Indian participation in the labor force has increased as Indians have moved off reservations; however, even in urban settings, Indian unemployment remains high. Job opportunities on reservations are scarce. Tribal governments are increasingly asserting their sovereign status and distancing themselves from the federal government in hopes of creating viable economic institutions that will bring job opportunities to the reservations. Federal law continues to frustrate these efforts.

In April 2020, the unemployment rate for American Indians and Alaskan Natives reached a peak of 28.6 percent, a rate equivalent to the unemployment rate during the Great Depression. For the first time since 2009, the unemployment rate dipped below that of the total American population in September of 2020. Other than this outlier, the American Indian population's unemployment rate in the twenty-first century remained much higher than the total American unemployment rate.

Bibliography

Ambler, Marjane. Breaking the Iron Bonds: Indian Control of Energy Development. UP of Kansas, 1990. Ambler provides a historic analysis of problems, paternalistic government policy, and exploitation which have prevented economic development on Indian lands. She focuses on the potential for energy development on reservations as a source of economic revitalization for tribes.

Biolsi, Thomas. Organizing the Lakota: The Political Economy of the New Deal on the Pine Ridge and Rosebud Reservations. U of Arizona P, 1998. Examines what happened to the political and economic life of the Lakota people when the Indian Reorganization Act was implemented on two western reservations. The reform agenda of the IRA was not really designed to transfer power to tribal governments; as a result, tribes continue to be hamstrung in attempts to develop economically or politically apart from the federal government.

Cornell, Stephen. The Return of the Native: American Indian Political Resurgence. Oxford UP, 1988. Cornell’s book does not focus directly on Indian economic issues; rather it takes a broad look at the complexity of Indian-white relations in the United States. Economics is a strand woven into this tapestry. This broader view permits one to see clearly some of the reasons reservation economic development has been so bleak to this point and why it is so vital for the continuation of tribal governments.

Lawson, Michael. Dammed Indians. U of Oklahoma P, 1982. Explores the devastating economic impact of dams along the Missouri River to Sioux reservations. In the 1950s a series of dams upset reservation economies and caused long-lasting economic and cultural hardships.

Meriam, Lewis, et al. The Problem of Indian Administration. The Johns Hopkins UP, 1928. This seminal work appraises the failings of the federal government to give Indian people a true voice in their governance and destiny. It explores in depth the poor economic conditions on reservations in the 1920s and the reasons for them. Much of the analysis is still meaningful.