“Racial inequality has always come at an inordinate cost, which was seen as paid only by underrepresented groups,” said Raymond McGuire, vice president of Citigroup and one of the report’s authors. “What this report highlights is that this tariff is levied on all of us, and in particular in the United States, this cost has a real and tangible impact on the economic output of our country. ”
Most of the $ 16 trillion lost is based on a lack of loans to black entrepreneurs, which Citi says has cost US $ 13 trillion in business revenue and 6.1 million new jobs per year. Another $ 2.7 trillion in income was lost due to the racial wage gap for black Americans, while lack of access to higher education for black students could have added $ 90 to $ 113 billion. lifetime income dollars. Finally, the lack of equal access to home loans, which could have led to 770,000 additional black homeowners, cost 218 billion dollars.
Additionally, the study found that if racial inequalities were addressed today, $ 5 trillion could be added to the economy over the next five years.
The report was released alongside Citi’s announcement to invest more than $ 1 billion in strategic initiatives over the next three years aimed at closing the racial wealth gap.
Called “Action for Racial Equality,” it will focus on increasing investment in black-owned businesses as well as promoting the growth of black homeownership, among others.
“Tackling racism and closing the racial wealth gap is the most critical challenge we face in creating a just and inclusive society and we know the same will not do the same,” said Citi CEO Michael Corbat in a statement, adding that the company is committed to using its resources and influence to “combat the impact of racism on our economy”.
– CNBC’s Michael Bloom and Courtney Connley contributed reporting.
To subscribe to CNBC PRO for exclusive news and analysis, and live business day programming from around the world.