Sample is a — five-year estimate. Given the disproportionate representation of black workers in front-line occupations where they face greater risk of exposure to COVID, it is not surprising that illness and deaths are disproportionately found among black workers and their families.
The ratios are even higher in some states: in Wisconsin and Kansas, the rate of African American deaths is more than four times as high as their share of the population in those states Meepagala and Romer By comparison, whites account for a smaller share of deaths than their share of the population. These weighted population distributions indicate that African Americans represent a larger share of the population in areas where outbreaks are occurring than their representation in the population overall Even accounting for this fact, African Americans still have higher death rates than their weighted population shares would indicate.
Notes: White refers to non-Hispanic whites, black refers to blacks alone. All shares are as of May 13, Weighted population shares reflect the racial distribution of the geographic locations where COVID outbreaks are occurring, and help to ascertain whether disproportionate deaths are occurring within certain racial groups.
The devastating effects of COVID on the economic and physical well-being of black Americans were entirely predictable given persistent economic and health disparities. In this section, we describe some of the underlying economic and health factors behind the unequal outcomes observed thus far. These same factors will ultimately prolong the effects of the pandemic on black workers and their families long after the immediate threat has passed.
Black workers and their families were economically insecure before the pandemic tore through the United States.
The pandemic and related job losses have been especially devastating for black households because they have historically suffered from higher unemployment rates, lower wages, lower incomes, and much less savings to fall back on, as well as significantly higher poverty rates than their white counterparts. This prior insecurity has magnified the current economic damage to these workers and their families.
The next seven figures illustrate the differences in socioeconomic status between white and black workers, households, and families. Historically, black workers have faced unemployment rates twice as high as those of their white counterparts. When the overall unemployment rate averaged 3. This difference cannot be explained away by differences in educational attainment. Figure E shows that at every level of education, the black unemployment rate is significantly higher than the white unemployment rate, even for those workers with college or advanced degrees.
Notes: White refers to non-Hispanic whites, Black refers to Blacks alone. Educational categories are mutually exclusive and represent the highest education level attained for all individuals ages 16 and older. Among the employed, black workers face significant pay penalties.
No matter how you cut the data, black workers face significant pay gaps in the labor market, and research has shown that these pay gaps have grown since and in the decades before Gould a; Wilson and Rodgers On average, black workers are paid 73 cents on the white dollar. Because of historic and current privilege in the labor market National Advisory Commission on Civil Disorders , white men enjoy exceptionally high wages. Therefore, the gap between white men and black men is particularly stark.
Black men are paid only 71 cents on the white male dollar. Black women, who face both gender and race discrimination, are paid even less—64 cents on the white male dollar. As Figure F shows, black—white wage gaps persist across the wage distribution as well as at different levels of education in the pre-pandemic economy.
The black—white wage gap is smallest at the bottom of the wage distribution, where a wage floor—otherwise known as the minimum wage—keeps the lowest-wage black workers from being paid even lower wages.
The largest black—white wage gaps are found at the top of the wage distribution and are explained in part by occupational segregation—the underrepresentation of black workers in the highest-wage professions and overrepresentation in lower-wage professions—and the pulling away of the top more generally. Similarly, across various levels of education, a significant black—white wage gap remains. Even black workers with an advanced degree experience a significant wage gap compared with their white counterparts.
Not only is black worker pay significantly less than that of their white counterparts, but their benefits are as well. Along with health insurance, discussed in more detail below, two benefits are acutely important at this particular time: paid sick days and the ability to work from home. Figure G illustrates how black workers are less likely than white workers to enjoy these benefits. The Family First Coronavirus Response Act was an important first step in providing vital paid sick days, but somewhere between 6.
Obviously, those loopholes need to be closed, and workers—regardless of race or ethnicity—also need a permanent fix to this basic labor standard. Fewer than one in five black workers in the pre-pandemic economy were able to work from home. This inability to keep their jobs and stay safe makes it even harder for black workers to maintain economic and health security during this difficult time. Sources: U. Significant gaps in both employment opportunities and wage levels translate into lower incomes and higher poverty rates in the pre-pandemic economy, as shown in Figure H.
On top of decades of preferential wealth accumulation for white families versus black families Rothstein ; Darity et al. At the bottom of the income distribution, the black poverty rate is two-and-a-half times the white poverty rate. Job loss for those living at such low incomes is absolutely shattering. Black households are households in which the head of household is black. White households are households in which the head of household is white. The poverty rate is the share of people whose family income is below the official family-size-adjusted poverty threshold.
In the pre-pandemic economy, black workers were less likely to have multiple earners in their household shown in Figure I. Half of all black households had only one earner, while nearly half of all white households had at least two earners. This racial disparity in the number of household earners is not just a function of how many working-age adults live in the household, or family structure, but is another measurable consequence of the persistent 2-to-1 ratio between the black and white unemployment rates.
The inequities black workers experience in the labor market have larger consequences for the economic vulnerability of black households because it is far more likely that when one household member loses their job, it translates into a complete loss of income for that household. Black households are less likely to have a second earner to fall back on to make ends meet.
Nonelderly households are those in which the heads of household are ages 18— Single working parents, a subset of one-earner households, face the added burden of needing to balance the competing demands of work, online distance learning, and child care responsibilities. Black women, in particular, as shown in Figure J , find themselves at the nexus of these overlapping responsibilities since they are 3. Black households are households in which the head of household is Black. Source: U.
On top of lower wages and incomes and higher poverty rates, black families have significantly less access to liquid assets than white families.
To weather a financial loss, families often must dip into their liquid assets to pay for their living expenses. If they lose their job or experience a serious health shock, their only hope of making ends meet and continuing to pay their rent or mortgage and put food on the table is to rely on their savings.
Wealth is often tied up in housing assets, particularly for black families, and therefore is inaccessible when dealing with sudden and large losses in income.
Figure K displays one component of wealth, the total value of all transaction accounts for black and white families. Transaction accounts include checking or savings accounts, cash, prepaid cards, and directly held stocks, bonds, and mutual funds. These are assets that can quickly be used to purchase goods and services, unlike less liquid sources of wealth like homeownership or assets in k s.
This makes white families far more capable of weathering the storm of COVID, whether it be job loss or another financial hit. The attainment of higher education does not bridge this divide. This gap remains large when we compare white and black families whose heads of household have the same level of education.
In fact, the absolute gap in liquid assets between black and white families is far larger among those with a college degree or more versus those with less than a college degree.
White families headed by a college-degree holder have nearly five times the access to money in transaction accounts as similarly degreed black families. The gap persists whether the black family owns a home or not. The gaps in liquid assets differ by what sector the family head works in, but no matter how the data are cut, white families have far more access to liquid wealth.
Industry classifications 1 include mining, construction, and manufacturing. Industry classifications 2 include transportation, communications, utilities and sanitary services, wholesale trade, finance, insurance, and real estate.
Industry classifications 3 include agriculture, retail trade, services, and public administration. Race is the race of the survey respondent; industry classifications are for head of household. Education is the education level of the head of household. The survey is the most recent survey available. It is not surprising then that research by Ganong et al. Black workers also face greater underlying pre-pandemic health insecurities that make them more susceptible to the coronavirus.
Below we explore some of the factors contributing to the greater risk of adverse health outcomes related to COVID, including preexisting health conditions, lack of health insurance, housing conditions, and population density.
Preexisting health conditions—such as diabetes, hypertension, asthma, and diabetes—are associated with greater risk of death from the coronavirus. As shown in Figure L , African Americans experience all of these illnesses at higher rates than whites.
The greatest racial disparities exist in the prevalence of diabetes 1. Air pollution has long been known to increase risk of heart and respiratory disease, heart attacks, asthma attacks, bronchitis, and lung cancer Sass Therefore, environmental racism—the disproportionate impact of environmental hazards on health outcomes among people of color—is a contributing factor to these racial health disparities.
According to a report by a group of scientists at the EPA National Center for Environmental Assessment, published in the American Journal of Public Health , people of color are disproportionately affected by air pollution due to their proximity to particulate-matter-emitting facilities Mikati et al.
Age-adjusted prevalence of asthma, diabetes, and hypertension among adults ages 18 and over. Age-adjusted prevalence of obesity among adults ages 20 and over.
Early diagnosis and treatment are essential to minimizing the severity of chronic illnesses, and regular health care is important for promoting better overall health. This is likely an additional contributing factor to the disparity in chronic illnesses described above, but it also might result in uninsured workers waiting longer to seek care for suspected coronavirus symptoms.
The CARES Act includes forgivable loans, tax credits and deferrals, and other measures to encourage small businesses to retain employees. Cities including Sacramento and New York have offered zero-interest loans and direct cash grants. But few jurisdictions have enacted legislation providing targeted assistance to minority-owned businesses.
Lawmakers should substantially expand the resources and authority of the Minority Business Development Agency and allocate financial assistance specifically for minority-owned businesses.
With little to no liquid wealth and vulnerable job prospects, people of color are more likely to face housing insecurity during the current economic downturn, including exposure to eviction and foreclosure. The prohibition of foreclosures on all federally backed mortgages for 60 days through the CARES Act will not be enough for homeowners. Many Black homeowners are already in a precarious economic situation, and this pandemic will only exacerbate their financial difficulties.
The prohibition should be extended through the end of the year. Also, all evictions should be stayed until the end of the year. Tens of millions of Americans, especially people of color , are struggling to pay down their student loans. While previous stimulus bills addressed the emergency needs of defaulted borrowers and suspended payments on federally held student loans, they neglected payments on Perkins and Federal Family Education Loans.
Future packages should include these borrowers and ensure that all borrowers receiving temporary relief are not subject to capitalization in interest when this period elapses.
With fewer assets and less liquidity, people of color are likely to struggle to withstand the economic fallout of the COVID pandemic. This anxiety puts them at greater risk of financial exploitation by predatory lenders. Federal lawmakers should expand the resources and authority of the Consumer Financial Protection Bureau to combat deceptive financial tactics and other forms of pandemic profiteering. Countless American families are currently experiencing severe financial shocks through no fault of their own.
At least 16 million workers filed for unemployment in just the past three weeks. Americans should not be penalized for depending more heavily on consumer credit in these uncertain times. This is especially important for people of color, who have less wealth , depend more heavily on credit during emergencies, and are more likely to experience unemployment during economic downturns. Future relief packages should temporarily restrict the effect that high balance-to-limit ratios, new credit, and delinquencies have on credit scores.
The U. Equal Employment Opportunity Commission is charged with enforcing federal laws that make it illegal to discriminate against job applicants and employees, but it lacks the funding and staff necessary to hold bad actors accountable. States have also neglected to enact and fully enforce their own civil rights statutes to protect workers of color, especially women of color, from hiring and wage discrimination.
Lawmakers should provide civil rights attorneys with the resources they need to ensure a robust, equitable economic recovery.
Previous recoveries, especially those of the 20th century, created bold new policies and programs but exacerbated racial inequality. Federal mortgage insurance, the national minimum wage, overtime requirements, and collective bargaining rights are all examples of measures that are meant to assist struggling families and expand access to economic mobility, but people of color have been explicitly or implicitly excluded from those benefits. This should not happen again.
Structural racism in federal, state, and local policymaking produced and has sustained stark inequities in economic well-being in the United States.
People of color—who have long endured financial exploitation, occupational segregation, and employment discrimination—remain among the most vulnerable Americans during times of economic hardship. This analysis utilized data from the — ACS five-year estimates. The authors weighted the percentages to reflect population characteristics. To find the latest CAP resources on the coronavirus, visit our coronavirus resource page.
Alexandra Thornton , Andy Green. Liz Kennedy , Danielle Root. Colin Seeberger Director, Media Relations. Peter Gordon Director, Government Affairs. Madeline Shepherd Director, Government Affairs.
Economic downturns and people of color: Lessons from the Great Recession From December to June , the United States experienced one of the longest and most severe economic downturns in living memory. Figure 2. People of color have fewer assets and less liquidity to respond to an emergency Decades of structural racism in economic, educational, and housing policies have produced a stark racial wealth gap in the United States.
Housing instability in the wake of the coronavirus Many of the federal homeownership and housing affordability policies of the 20th century disproportionately benefited white households while excluding households of color. Connor Maxwell Senior Policy Analyst. As you can see in the charts below, unemployment initially held steady for men and women from White and ethnic minority groups in the first full quarter after the March lockdowns. But there were sizeable increases during summer , with the labour market particularly unwelcoming to ethnic minority workers.
Much of the increase in joblessness has been driven by the fact that younger workers have poorer prospects — this is in keeping with previous recessions. Why is this? It is well known to researchers that recessions affect ethnic groups differently. Previous studies have noted that ethnic minority unemployment rates rise faster at such times. And following the financial crisis, workers from Black African and Caribbean groups faced higher unemployment levels compared to White people. The chart below, using data from the Labour Force Survey, shows that the after-effects of the financial crisis lasted longer for young people from ethnic minorities.
Their unemployment rates did not experience a sustained fall until , three years after White people. Given the long-term consequences of periods of unemployment for future employment and wages, such patterns are deeply worrying. Since we know that downturns disproportionately affect young people from ethnic minority backgrounds, policymakers should be ready to act.
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