The economy lost out on $16 trillion in the last 20 years as a result of racial inequality, according to a report from Citi.
“We discover that closing racial gaps is a pareto improvement to both the U.S. economy and society,” the report said.
The study calculated the economic gains the country would have experienced if it had closed racial gaps in wages, education, access to housing credit and lending to entrepreneurs.
By far, the equitable lending gap was the largest contributor, calculated at $13 trillion.
“This could have been used for investments in labor, technology, capital equipment, and structures and 6.1 million jobs might have been created per year,” the report said.
The wage gap accounted for another $2.7 trillion, while education and housing would have accounted for gross domestic product (GDP) gains in the low hundreds of billions of dollars.
Filling those holes today would lead to an additional $5 trillion in GDP over the next five years, according to the report, adding a significant 0.35 points to annual growth.
The study also outlines what the government, companies and individuals could do to close the gaps, including more race-specific data collection, expanding access to affordable child care and policies to ensure a living wage.
It highlighted expanding the Postal Service as a financial institution to provide banking for low-income households.
The report also urged businesses to examine their own demographics and policies on diversity and inclusion.