JECDems Chairman John Beyer

Republished from Joint Economic Committee Democrats (JECDems), visited May 20, 2022,

Native American communities face significant and unique barriers to accessing economic opportunities. The Joint Economic Committee analyzed available data and trends affecting the Native American community, finding the following:

• Native Americans face barriers to accessing quality education and jobs, reducing economic mobility and leading to disparities in labor participation, educational attainment and income.

• Native American households and businesses struggle to access credit and financing on equal terms with other Americans, hindering the growth in Native enterprises and household wealth.

• Native American communities were particularly hard hit by the coronavirus pandemic, exacerbating long-standing health disparities resulting from inadequate funding for Native healthcare infrastructure and major obstacles to care.

More needs to be done to improve economic opportunities for Native American families and communities, and the federal government should do so by working with, and meeting obligations to, tribal governments and Native peoples. The recently enacted bipartisan Infrastructure Investment and Jobs Act is a step forward and will invest over $11 billion in Native communities, including funding for broadband, water and transportation infrastructure.


Native American communities in the United States continues to face pervasive structural barriers that threaten their economic security and opportunities. The legacy of removal, forced assimilation and unkept obligations are reflected in the nature and magnitude of these economic disparities. This report examines the inequities faced by American Indian and Alaska Native (AIAN) communities and offers some policy recommendations that can help pave the way for improved economic well-being and mobility.

This report uses American Indian and Alaska Natives interchangeably with Native Americans and Native communities or people. This is done while recognizing evolving discussions concerning the limitations of existing definitions, counts and data sources. In 2020, the AIAN-identifying population reached 9.7 million, accounting for 2.9% of all people living in the United States, compared with 1.7% (5.2 million) in 2010. From 2010 to 2020, the American Indian and Alaska Native identifying population increased by 160%.

The economic well-being and mobility of Native people are held back by persistent disparities in employment, income and education. Among Native Americans, the labor force participation rate, which measures those currently working or looking for work, remains below the national rate. AIAN individuals are also more likely to be unemployed, which is defined as those looking for work but without a job, than their white peers. Native Americans are more likely to earn less than non-Hispanic whites. These disparities contribute to intergenerational poverty and deprivation. Across their lifetime, Native Americans are more likely to live in poverty than individuals of other minority groups. Escaping this cycle of intergenerational inequity and climbing the ladder of economic mobility is further complicated by disparities in education that disproportionally harm Native Americans; nearly 80% of Native Americans over the age of 25 hold less than a bachelor’s degree.

The economic security and opportunity of Native American families is further constrained by barriers to wealth-building and inequities in access to financing. The typical white family has more than twice the wealth of the typical AIAN family (although the data reflecting AIAN family wealth is not fully disaggregated and is reported in a composite along with Asian, Native Hawaiian, Pacific Islanders and other identities). Because wealth serves as an enabler of economic opportunity, this disadvantage translates into other inequities in housing and beyond. Despite a strong preference for homeownership, a smaller share of Native households own homes today than in 2000. Native American households are disproportionally harmed by lack of access to banking services, and they are more likely to be underbanked than any other minority group in the United States. Similarly, Native entrepreneurs are more likely to face barriers to obtaining credit and report a greater reliance on informal banking financing, like credit cards, for business startup and growth.

Pervasive economic inequality has also led to worse health outcomes in Native American communities. For example, the uninsured rate among Native Americans is higher than that of any other group. Combined with the chronic underfunding of tribal health care and restricted access to hospitals and grocery stores, this has led to disproportionately high rates of chronic health conditions among Native communities. Throughout the pandemic, Native Americans have experienced higher rates of COVID-19 infections, hospitalizations and death than their white counterparts. Additionally, Native Americans suffered financially through the pandemic as the gaming and entertainment industry was especially impacted by social-distancing measures. Tribal governments, unlike state and local governments, do not have a tax base. This makes tribal governments rely on revenue from their enterprises to fund their services. Tribal governments have struggled with less revenue in a time when more support is needed in the communities they serve. Tribal revenues have also been disproportionally affected by the pandemic; in a survey of tribal governments, 75% responded that they reduced services related to economic development due to falling revenue streams.

Expanding economic well-being and mobility for Native Americans will require keeping up with trust and treaty obligations and a broad basket of proactive structural solutions. Investments in the American Rescue Plan, including $31 billion for Native American communities—the single largest federal investments in Indian Country in U.S. history—were aimed at addressing the immediate impact of the public health crisis and the economic fallout. Investments in the bipartisan Infrastructure Investment and Jobs Act, which include $11 billion for tribal entities, are an important step to addressing pervasive structural barriers that restrict economic growth and limit economic opportunities in AIAN communities.

Native American communities also stand to benefit from investments in families, education, renewable energy and healthcare in proposals laid out by Democrats in Congress and the Biden administration. To build an economy of shared prosperity and inclusive growth, more must be done to invest in Native communities and expand access to economic opportunities for Native households and enterprises. In this process, it is important to keep in mind that under the principle of self-determination, tribal nations should determine what their priorities are and what kinds of projects they would welcome on their homelands.


Because of divergent economic opportunity, Native Americans are less likely to be employed than the population as a whole

Data on labor force participation and other measures of employment that are specific to the AIAN population are limited and generally difficult to calculate effectively. The Bureau of Labor Statistics (BLS), the entity responsible for the commonly cited monthly report on labor market conditions (“The Employment Situation”) that includes measures like unemployment by some categories of identity, did not publish data for AIAN workers for decades due to small sample sizes. Recently, the Bureau began to publish monthly not seasonally adjusted data on the AIAN unemployment rate. To address prior and ongoing gaps in the data, the Federal Reserve Bank of Minneapolis designed the Native American Labor Market Dashboard. While the dashboard includes additional data, this report uses their rolling three- month average data, which pool three months of data to reduce volatility due to small sample sizes and approximate real-time data on the labor market for AIAN workers.

The data published by the Minneapolis Fed reveal disparities in employment between AIAN communities and individuals of other identities. In March 2022, just 59% of Native Americans aged 16 and older were participating in the labor force (employed or searching for work) compared to 62% of all individuals. The employment-to-population ratio, another statistic which measures total employment relative to the total working-age population, shows that AIAN employment lags behind the national rate. Approximately 54% of Native Americans were employed according to the March 2022 three-month rolling average, relative to 60% of all individuals. The three-month rolling average unemployment rate for Native Americans in March 2022 was 7.8%, greater than the one-month unemployment rate for all other minority groups. The three-month rolling average unemployment rate for non-Hispanic white individuals was 3.3%, 4.5 percentage points less than for Native Americans (see figure below).

Economic conditions for Native Americans in the United States, residing both on and off tribal lands, are variable. For those who live on the 326 tribal reservations and joint-use areas (places where multiple American Indian reservation governments share legal and political authority), the economic conditions depend largely upon the tribe and the time period in question. While the national difference between


AIAN and white unemployment rates may seem insubstantial, the lower participation rate for AIAN masks the more dire circumstances of individuals searching for employment on reservations in places like South Dakota and Arizona where the gaps in employment are more dramatic.

Using similar methods to those employed by the Minneapolis Fed, Joint Economic Committee Democratic staff estimate that since 2007 the Native American unemployment rate has remained an average of twice that of non-Hispanic, white Americans. However, there has been marked improvement in employment since the California v. Cabazon Supreme Court decision and the 1988 signing of the Indian Gaming Regulatory Act (IGRA), which reaffirmed tribal sovereignty and opened the door to tribal government gaming on reservation land. The IGRA facilitated the creation of tribal gaming enterprises like casinos and bingo halls, creating jobs on reservations where employment opportunities can be limited. Following the passage of this legislation, from 1990 to 2010, the unemployment rate dropped 6.9 percentage points and the female labor force participation rate increased 6.0 percentage points.

The median Native American household made over $25,000 a year less than the median non-Hispanic white household in 2019

Between 2000 and 2019, household income grew more in Native American households than in white, non-Hispanic ones. However, AIAN households still make over $25,000 less than the median non- Hispanic white household, as can be seen in the figure below.

The past 40 years have seen rising wage inequality and stagnating wage growth in the United States. Because Native workers are overrepresented at the bottom of the income distribution, even relative to Black and Hispanic workers, decades of anemic wage gains among low-income workers have hit the Native community especially hard.

Approximately one in six Native American families lives below the poverty level

Native Americans experience higher rates of poverty than white individuals, irrespective of age. In 2019, Nearly one in six AIAN families live below the federal poverty level, and that increases to 26% for families with children under 5 years old. Overall, more than 25% of children (ages 17 and under) who identify as AIAN (alone or in combination with another group) live in poverty, and among seniors (those 65 years and older), nearly 15% live in poverty. Among adults younger than the retirement age (between the ages of 18 and 64), or those most likely to participate in the workforce, 19% live in poverty. For comparison, less than 6% of all white families, less than 10% of white families with a child under 18 and around 7% of white seniors live in poverty.


The consequences of these relatively high poverty rates among Native Americans are felt throughout the life cycle. Poverty has well-documented adverse effects on children’s educational outcomes and limits young adults’ ability to pursue post-secondary education. Children born to families at or below the poverty line are more than twice as likely to be in poor health when they grow up as those who are born into families with incomes that are more than twice the poverty line.

Policies that expand access to employment, adequate wages and opportunities to build wealth, will help alleviate Native American poverty and the corresponding negative outcomes.

Nearly 80% of Native Americans over the age of 25 hold less than a bachelor’s degree

Native Americans are much less likely than their non-Native peers to graduate from high school or attend college. As can be seen in the figure below, of individuals who self-reported as AIAN (whether alone or in combination with another ethno-racial identity), 79% had less than a bachelor’s degree and 16% had less than a high school diploma. Of those identifying as AIAN alone, approximately 84% had less than a bachelor’s degree and 19% had less than a high school diploma. These levels are dramatically different than for those who identify as non-Hispanic white, among whom only 63% have not completed a bachelor’s degree and less than 7% have less than a high school diploma.

Economic success depends not only on whether an individual received an education but on whether they got a good enough education to lead to a well-paying career. In recent decades, the economic returns to education have increased substantially, and more education is becoming more frequently needed to achieve a basic level of financial success. Native Americans are disproportionately likely to live in poverty, including those who do not live on tribal lands. For those that do, the limitations on tribes’ abilities to raise revenues prevent them from taking even the limited tax-related steps available to poor municipalities to address the underfunding of tribal schools.

While 90% of native students attend traditional public schools, the quality of the education provided to much of the other 10% by the Bureau of Indian Education (BIE) is widely regarded as unacceptably low.


The BIE is a federal entity responsible for the educations of 46,000 students who attend more than 180 schools which are under varying levels of federal control. Beyond the various oversight programs under the BIE, there are more than 200 federally-recognized Tribal Education Departments operating in 32 states, all of which wield diverse tools and authorities to “implement education goals and priorities,” furthering tribal self-determination in education.

In the schools directly managed by the Bureau, BIE has repeatedly failed to implement necessary reforms and student services. For 13 years, the U.S. Department of Education has warned the BIE that they are failing to meet minimum expectations for special education services in the schools they actively oversee. The BIE has also failed to implement reforms in these schools that would track academic performance and allow families to hold them accountable in the same ways that parents served by traditional public schools are able to do. Some tribally controlled schools that technically fall under BIE are the exception to this record of poor performance. For example, the Santa Fe Indian School (SFIS), a Pueblo-governed middle and high school, has been lauded by federal entities as an institution that not only prepares students for higher education but offers nationally recognized academic programs and produces a large number of Gates Millennium Scholars. While success stories like SFIS show that providing quality education to Native youth outside of traditional public schools is well within reach, remedying these dramatic disparities in access to a quality education would increase opportunities for economic success for young Native Americans.


The typical Native American family holds less wealth than the typical white family

The typical white family has more than twice the wealth of the typical families who identify as AIAN, Asian, Native Hawaiian, Pacific Islander or having more than one ethnic and racial identification (see figure below). Yet, these figures may underestimate the wealth gap between white and Native American families. This is because the Federal Reserve Board’s Survey of Consumer Finances, the most reliable source of data on net worth by some identity categories, does not disaggregate within this category. For that reason, more granular wealth data are not available for any specific group.


Recent research uses local, more disaggregated data from Oklahoma to paint a more nuanced picture of the wealth position of Native American households in the Tulsa metropolitan area. The typical Native American household in Tulsa holds anywhere from eight to 88 cents for every dollar of wealth held by the typical white family in the area. This wide range is explained by the variation observed across tribal affiliation and enrollment, and underscores the challenge of understanding how Native American household wealth is distributed. For example, tribally enrolled Cherokee households in the Tulsa metropolitan area have a higher net worth relative to other Native households tribally enrolled and not enrolled.

While the precise magnitude of the wealth disparities observed in the Tulsa metropolitan area may not reflect the financial reality of all Native American families in the United States, the estimates offer important insights into the varied experience of Native American communities.

Native American households face barriers to homeownership, a vital tool to build wealth

Despite a strong preference for ownership, a smaller share of Native households own their homes today than in 2000. Only about half of Native households (in this case, those identifying as AIAN alone) owned their home in 2020, relative to more than 7 in 10 white households (see figure below).

While 75% of Native households report having a strong desire to own their home, they face significant barriers. To start, Native American communities face an inadequate supply of housing. This has led to overcrowding and physical housing problems that are far more severe in Native American areas than in other parts of the country. A Department of Housing and Urban Development study finds that 68,000 units need to be built in Indian Country to alleviate substandard and overcrowded homes. Some experts believe these figures may underestimate the precise level of need given the prevalence of poor-quality housing and severe overcrowding in these communities.

Access to affordable capital is a persistent challenge for Native Americans who wish to own their home; among other aspects, administrative burdens, lack of access to land title records, lack of financial institutions on or near tribal lands, data titles and inter-agency inefficiencies have limited conventional lender participation in these communities. Even when private capital reaches them, Native borrowers are more likely to pay a high premium that limits their ability to accumulate equity and build wealth. The Center for Indian Country Development at the Federal Reserve Bank of Minneapolis finds that loans with


Native Americans as the primary borrower have an average interest rate that is nearly 2 percentage points above the average loan for non-Native Americans. These higher-priced home loans are found predominately on reservation lands; around 30% of mortgages for Natives on-reservation were high- priced, compared to only 10% for non-Natives near reservations.

Native American households are disproportionally harmed by lack of access to banking services

More than 1 in 10 (or 16%) of Native American households are unbanked. This figure is three times higher than the national average. A larger share of Native American households lack access to banking than any other minority group in the United States (see figure below).

Unbanked Native households lack access to a checking or savings account in part due to banking deserts. On average, majority-Native American counties have only three bank branches. This figure is lower than the nine-branch average in non-metro counties, and well below the 26-branch overall average for all counties nationwide. Obtaining access to banking services is difficult for Native American families when the nearest bank branch is, on average, 12 miles away from the geographic center of a reservation and sometimes even more than 70 miles away. In contrast, the nearest banking branch is within less than 1 mile on average for most counties across the country.

Being unbanked is expensive and time-consuming. Each financial transaction for the underbanked involves fees and costly hurdles. The unbanked must pay fees to send and receive money, to cash checks and even to simply use debit cards. For example, Native Americans are more likely than their white counterparts to report using costly, reloadable prepaid debit cards, and less likely to use a credit card. Overall, Native American communities are less likely to use mainstream financial services products and more likely to use alternative financial services products.

Native American businesses are more likely to struggle in obtaining credit

There are about 300,000 Native-owned small businesses in the United States, which generate around $50 billion in annual revenue. Native American business owners generate jobs and economic activity in a wide array of industries, including tourism, gaming, energy, agriculture, forestry, manufacturing and federal contracting.


Despite these contributions, small businesses owned by Native Americans struggle to access bank credit. Relative to all business owners, fewer AIAN business owners report using bank financing to start their business. In 2012, for example, about 6% of AIAN businesses owners reported using formal bank financing as source of startup capital. By comparison, nearly 8% of all business owners reported doing the same.

Native American business owners also report a greater reliance on informal banking financing, like credit cards, for business startup and growth than non-Native entrepreneurs. About 10% to 15% of Native- owned businesses consistently report using credit cards to finance start-up costs. This figure is 3 to 5 percentage points higher than what is typical for non-Native entrepreneurs. The Native Nations Institute and the U.S. Department of Treasury’s Community Development Financial Institutions Fund find that Native American entrepreneurs face more barriers than others in obtaining business capital, including prohibitively high interest rates on loans and the inability to use trust land as collateral.

Limited access to capital and structural inequalities leave minority-owned businesses more vulnerable to economic shocks. For example, Native-owned small businesses are among businesses that have been most financially harmed by the coronavirus pandemic; a survey of small businesses in Indian Country in 2020 found that about 68% of businesses saw at least a 20% revenue reduction, while 1 in 6 businesses reported having lost all revenue (as of mid-July 2020) because of the pandemic. Small businesses in tribal areas were also less likely to receive Paycheck Protection Program assistance and received less, on average, than businesses in non-tribal areas when they were able to obtain support.



AIAN communities lack access to health insurance, medical care facilities and grocery stores

The AIAN community disproportionately lacks access to critical services and supports, like health insurance, medicalcare facilities and grocery stores, leading to chronic health conditions. This made Native communities especially vulnerable to the coronavirus and contributed to higher rates of infection, hospitalization and death.

Past efforts to address health disparities have fallen short. In treaties spanning nearly the entire history of the United States, the federal government committed to provide Native Americans free health care in exchange for tracts of land. This trust obligation, like many others to the AIAN community, has not been met. The Indian Health Service (IHS) is consistently and chronically underfunded with the capacity to spend $3,333 per user on average compared to $9,404 for the Department of Veterans Affairs and $12,744 for Medicare. Unlike other federal health programs, IHS does not receive advance appropriations, making it difficult to plan long-term health infrastructure such as facility improvements and health professional recruitment and retention. This lack of funding coupled with the fact that tribal communities tend to be in rural, remote or isolated locations, has led to a devastating and dangerous lack of access to hospitals and adequate health care. For those who can access care, nearly a quarter of Native Americans have also reported that they have personally experienced discrimination when visiting a doctor or health clinic.

Native American communities lack access to affordable health insurance. Nearly 20% of those who identify as American Indian or Alaska Native alone are not covered by either public or private health insurance, a rate higher than that of almost every other group (see figure below).


In addition to being particularly harmed by the health effects of the pandemic, research has shown that stay-at-home measures exacerbated long-standing barriers in AIAN communities to accessing healthy food. Households on reservations must travel more than 20 miles on average to reach the nearest supermarket, one of the longest distances nationwide. Stay-at-home measures and a need to reduce social exposure led more AIAN households to opt for shorter distances to convenience stores, which tend to have more processed foods and less fresh produce.

The underfunding of tribal health care, a high uninsured rate and restricted access to hospitals and grocery stores has led to worse health outcomes in Native communities. Native Americans have been found to experience higher rates of chronic liver disease and cirrhosis, diabetes, heart disease, cancer and lower respiratory diseases, among other health problems. Moreover, AIAN persons have a life expectancy that is 5.5 years less than the average American (73 compared to 78.5). These chronic conditions have also put tribal communities at a greater risk of COVID infection, hospitalization and death.

Native Americans were more than twice as likely to contract COVID-19 and die than non-Hispanic white Americans

Lower health status also made Native Americans more vulnerable to the health effects of the pandemic. As recently as February 2022, data from the CDC shows that AIAN persons are 1.6 times more likely to contract COVID-19, 3.1 times more likely to be hospitalized and 2.1 times more likely to die of COVID- 19 compared to non-Hispanic white persons. These rates are higher than those of all other minority groups tracked by the CDC (see figure below). The losses are particularly devastating for AIAN communities, where tribal elders are crucial to maintaining cultural traditions and language.


Tribal revenues have been disproportionally impacted by COVID-19

COVID-19 has exposed the economic vulnerability of tribal economies and tribal revenue streams. Like states and cities, tribal governments are responsible for providing key services to their communities. Unlike states and cities, tribal governments cannot collect adequatetaxes to pay for such services, making them uniquely dependent on income from tribal enterprises or federal government appropriations.

Tribal enterprises have proliferated since the late 1980s, and they serve as engines of economic activity, locally and regionally. For example, S & K Electronics is one of many enterprises owned and operated by the Confederated Salish and Kootenai Tribes on the Flathead Indian Reservation, and it generates about $1 million for the tribe to help fund departments ranging from forestry to health care. In addition to S & K Electronics, the Confederated Salish and Kootenai Tribes own gaming and energy enterprises and a local bank.

Tribal enterprises are active participants in an array of industries, including hospitality, tourism, energy, technological manufacturing and financial services. The gaming and entertainment sector in some tribal economies is massive and has been especially impacted by social-distancing measures. In 2019, tribal gaming enterprises alone generated $17.7 billion in taxes for federal, state and local governments. Researchers estimate that, together, tribal gaming and non-gaming enterprises and tribal government support 1.1 million jobs and more than $49.5 billion in annual wages and benefits for workers, a majority of whom are non-Native workers.

While these enterprises have largely reopened, all were closed at the height of the pandemic. This caused a crucial revenue source for tribes to disappear, such that in the fall of 2020, over half of tribally owned enterprises reported revenue losses of more than 20%. As a result, enterprises have fewer revenues to allocate to tribal governments, which results in cuts to essential community services. In a survey of tribal governments, 75% responded that they had been forced to reduce services related to economic development because of falling revenue streams. Over the long-term, this will restrict tribes’ pandemic recovery and overall economic growth.



Native American communities continue to face pervasive disparities after centuries of maltreatment and exclusion. The legacies of the past persist today in the form of inequities that continue to threaten the economic security and opportunities of AIAN communities. Across metrics of economic well-being, Native Americans are disproportionately underserved, economically vulnerable and limited in their access pathways to building wealth. These longstanding inequities have left Native communities much more vulnerable than their counterparts to the negative impact of economic shocks and public health crises.

Expanding economic justice for Native communities will require keeping up with trust and treaty obligations and a broad basket of proactive structural policies. To help address the immediate public health and economic impacts of the coronavirus, President Biden’s American Rescue Plan invested over $31 billion in Native American and tribal communities, making it the single largest federal investment in AIAN communities in U.S. history. Investments in the bipartisan Infrastructure Investment and Jobs Act, including $11 billion for tribal entities, are an important first step to addressing pervasive structural barriers in AIAN communities that restrict economic growth and limit economic opportunities.

The bipartisan Infrastructure Investment and Jobs Act includes $3 billion in funding for the Tribal Transportation Program, invests $3.5 billion in the Indian Health Service Sanitation Facilities Construction Program and $2 billion in spending for the NTIA Tribal Broadband Connectivity Program. Already, the Biden Administration announced in December 2021 that nearly $10 million in awards from multiple departments that play a role in overseeing broadband funding and development would be used to bring high-speed internet services to tribal lands. These and additional programs and funds dispersed in the future will connect the least connected group in the United States to the digital economy, helping to open a small window of opportunity for economic development, education, telehealth and more. Further investments in Native American communities and institutions will help improve AIAN well-being, health and education outcomes, as well as the financial security and mobility of these families.

Because Native American households are more likely to be unbanked than any other households in the United States, expanding access to Community Development Financial Institutions (CDFIs) would help facilitate more access to credit for Native American and tribal families. A study found that growing up on Native tribal reservations with reduced access to banking is equivalent to a significantly lower likelihood of having a credit report, lower credit scores and a loss in annual earnings of $6,000. Proposals of postal banking and other public banking options could also help improve the financial position of Native American families, as they can expand access to free bank accounts that can be used to receive money, make payments and withdraw cash.

These are all important steps to increase economic opportunity and prosperity of Native Americans for generations to come. However, more will be required via a concerted and enduring effort from both the federal government and tribal governments to ensure just outcomes for Native people. In this process, it is important to keep in mind that under the principle of self-determination, tribal nations should determine what their priorities are and what kinds of projects they welcome on their homelands.


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