Pre-existing inequalities in the United States and most countries around the world made ordinary people vulnerable to the dual blows of the current public health and economic crises. Flawed policy responses to the pandemic have contributed to a further widening of long-standing economic, racial, and gender divides.
Wealth and Income Inequality and Covid-19
Racial Inequality and Covid-19
Inequality Across Gender Diversity and Covid-19
Covid-19 and Inequality in the Care Economy
Wealth and Income Inequality and Covid-19
As ordinary people around the world suffer from the health and economic impacts of the pandemic, billionaires have actually seen their fortunes expand. According to Institute for Policy Studies analysis of Forbes data, the combined wealth of all U.S. billionaires increased by $1.763 trillion (59.8 percent) between March 18, 2020 and August 17, 2021, from approximately $2.947 trillion to $4.765 trillion. Of the more than 700 U.S. billionaires, the richest five (Jeff Bezos, Bill Gates, Mark Zuckerberg, Larry Page, and Elon Musk) saw an 107 percent increase in their combined wealth during this period, from $349 billion to $740 billion. We will be regularly updating this analysis here.
The crisis has fueled the country’s skyrocketing inequality. Among the 100 largest low-wage employers in the country, average CEO pay jumped 15 percent in 2020 to $13.9 million while their global median pay flatlined, according to Institute for Policy Studies analysis. More than half of these 100 low-wage companies rigged their own rules to inflate CEO pay — protecting top executives’ huge bonuses while their workers suffered during the pandemic.
The shift to telework has also played out across inequality lines. Affluent Americans, who are more likely to be white, have had much more flexibility to work at home, lowering their exposure to the physical, mental, and economic harms of Covid-19. According to a Census survey, adults in households with annual incomes of $200,000 or more were nearly six times as likely to have switched to telework in 2020 than those with income of less than $25,000.
The total number of unionized workers fell in 2020 with job losses across all parts of the ecoomy, but workers represented by unions in some hard-hit sectors either lost fewer jobs than their non-union counterparts, or, in some cases, actually gained jobs, according to Economic Policy Institute analysis. In retail, unionized workers actually gained 24,000 jobs while 659,000 non-union workers lost their jobs. This is likely a reflection of unionized workers having a greater voice in corporate decision-making, including around matters such as furloughs and severance pay in times of crisis.
What we have seen is that the reluctance of many low-wage service sector workers to return to their jobs — for a variety of reasons — has created leverage for long-overdue pay increases. According to the Bureau of Labor Statistics, as of July 2021, average hourly earnings in the leisure and hospitality sector, which includes restaurants and hotels, were up 9.6 percent over the previous year. In transportation and warehousing, wages were up nearly 6 percent and retail workers were pulling in more than 4 percent more than last year.
The vaccine rollout around the globe has been rife with inequality. According to research by the Agence France-Presse, high-income nations — such as the United States and members of the European Union — have been getting much more than their fair share of vaccine doses. Despite making up only 16 percent of the global population, people in high-income nations have gotten 47 percent of all vaccine doses. That is in contrast to people in lower-income nations, who have gotten just 0.2 percent of all vaccine doses, despite making up 9 percent of the world’s population.
Extreme pandemic disparities are not unique to the United States. Oxfam reports that from March 18 to the end of 2020, global billionaire wealth increased by $3.9 trillion. By contrast, global workers’ combined earnings fell by $3.7 trillion, according to the International Labour Organization, as millions lost their jobs around the world.
While U.S. billionaires are seeing their fortunes expand, the pandemic recession has hit low-income workers hardest. According to University of Chicago researchers, the lowest-income group had the highest job loss rate between February 1, 2020 and the end of June, while the highest-income workers had the lowest job loss rate during this period. While the gaps narrowed somewhat by the end of June, the lowest-income group had only 81 percent of the jobs they had on February 1 while the highest-income group had 96 percent of the jobs they had pre-pandemic.
Racial Inequality and Covid-19
According to the APM Research Lab, Black Americans have mortality rates that are significantly higher than all other race and ethnic groups except for Indigenous people. For each 100,000 Americans (of their respective group), about 256 Indigenous people and 179 Black people, 176 Pacific Islanders and 147 Latinx people have died from the coronavirus, compared to 150 Whites and 96 Asians, as of March 2, 2021.
People of color are more likely to suffer severe illness if they are infected with Covid-19. As of July 3, 2021, Center for Disease Control and Prevention data shows that hospitalization rates for Indigenous, Black, and Hispanic and Latinx people are significantly higher than for Whites and Asians, regardless of their age. Per 100,000 people, around 1128 Indigenous people, 879 Black people, and 732 Latinx people have had Covid-19 symptoms serious enough to require hospitalization, compared to 313 Asian people and 422 Whites.
The racial disparities in Covid-related health indicators have contributed to a larger decline in U.S. life expectancy for people of color, according to data from the National Center for Health Statistics. In 2020, life expectancy dropped for all races, but most sharply for Latinx and Black people. It dropped by 1.2 years to 77.6 for Whites, by 3.0 years to 78.8 for Latinx, and by 2.9 to 71.8 for Black people.
The pandemic-related economic crisis has been particularly devastating for people of color. When the shutdown sent unemployment levels skyrocketing in March and April, Black and Latinx workers were much more likely to be among the jobless than Whites, according to the Bureau of Labor Statistics data. This was true despite the fact that people of color make up a disproportionate share of essential workers who had to remain on the job. While the jobs picture has improved, the racial disparities remain. As of July, the unemployment rate was highest among Black Americans, at 8.2 percent, compared to 4.8 percent among White workers.
The Covid-19 pandemic has forced many workers into remote and telework as offices have closed around the country. But not everyone has the same ability to work from home. The most recent Bureau of Labor Statistics data on this are from 2017-2018. These pre-pandemic figures indicate that only 19.7 percent of Black and 16.2 percent of Latinx people work in jobs where they are able to telework, compared to 29.9 percent of White and 37.0 percent of Asian workers. This gap, combined with research documenting that Black and Latinx people now make up disproportionate numbers of jobs deemed “essential,” explains why people of color have been exposed to greater virus risks.
Inequality Across Gender Diversity and Covid-19
The Covid-19 pandemic has exacerbated long-standing gender inequalities. Women are more likely than men to work in service occupations, including domestic work, restaurant service, retail, tourism, and hospitality, that require face-to-face interactions and have been hard-hit by layoffs. Because of the nature of these jobs, teleworking is not an option for many women.
Frontline jobs, which are the ones most often deemed “essential” and require people to work in-person, are also heavily staffed by women. The health care, social work, and government and community-based services sectors are overwhelmingly made up of female employees, according to research from the Economic Policy Institute. Women make up 73 percent of government and community-based services workers, 76 percent of health care workers, and 78 percent of social workers.
In March 2020, U.S. men and women had the same unemployment rate — 4.4 percent, according to Bureau and Labor Statistics data. But in April, as the pandemic nearly shut down the economy, these rates sharply diverged, with the female unemployment spiking to 16.2 percent, compared to 13.5 percent for men. As the economy has improved, these gender gaps have narrowed and as of July 2021, women had a slightly lower unemployment rate than men (5.2 percent compared to 5.6 percent for men). But this masks particular employment challenges faced by women with children and women of color.
The official U.S. unemployment rate does not include people who have not looked for work in the past four weeks. Because women tend to bear more responsibility for family caregiving, women with children were more likely than men to drop out of the labor force when schools and care centers closed due to Covid. Rand Corporation research reveals that the steepest decline in labor force participation in the first phase of the pandemic was among women with two children, at 3.82 points, compared to a 1.39 point drop for men with two children. More recently, the shortage of affordable childcare services has emerged as a barrier for women in returning to jobs in restaurants and other low-wage sectors, contributing to staffing challenges.
Among U.S. women who’ve stopped looking for work during the pandemic, the steepest drops have been among women of color. Between February 2020 and July 2021, Black women had a 3.4 percentage point drop in labor force participation and Latinx women had a 4.2 point drop, compared to 1.6 for white women. Several factors may have contributed to women of color becoming discouraged from seeking work. On top of gender inequities, women of color face racial discrimination in hiring and layoffs and they are disproportionately concentrated in service and care sector jobs with high risks of Covid exposure.
Transgender people are always in a precarious position, but the Covid-19 pandemic has made them particularly vulnerable. According to research from the Williams Institute at UCLA, transgender Americans are at a higher risk for Covid-19 for several reasons. They are more likely to be low-income, with 47.7 percent of transgender people living below 200 percent of the official U.S. poverty line, compared to 28.9 percent of the general U.S. population. They are also significantly more likely to suffer from asthma and HIV, conditions that put people at higher risk of mortality if they contract Covid-19. And they experience high barriers to receiving health care.
The pandemic has also hit transgender Americans especially hard economically. A poll from the Human Rights Campaign and PSB Research shows that as of June 2020, 54 percent of transgender people had experienced reduced work hours — more than double the 23 percent of the total U.S. workforce that faced a similar reduction. Twenty-seven percent of transgender people had experienced pay cuts, compared to just 7 percent of the U.S. workforce. And 19 percent had become unemployed due to the pandemic, a significantly larger share than the general population.
Covid-19 and Inequality in the Care Economy
Care work is critical to the functioning of our society at any time. During the pandemic, this workforce, which is overwhelmingly female and disproportionately people of color, has become even more essential. The term “care work” encompasses both paid and unpaid work and encompasses both direct activities, like caring for children or nursing someone who is ill, as well as indirect care, like cooking and cleaning.
Domestic workers are one particular category of care workers. Whether hired by an individual or through an agency, this workforce performs a wide range of tasks, from cleaning to personal care, in private homes. Already a vulnerable category of workers, domestic workers are under immense stress as they serve on the frontlines of the Covid-19 pandemic. According to an April 2020 survey by the National Domestic Workers Alliance, 84 percent of domestic workers reported experiencing food insecurity, 77 percent were the primary breadwinners for their families, 72 percent reported having lost their livelihoods, and half reported lacking access to medical care during the pandemic.
As a joint survey from the Institute for Policy Studies and the National Domestic Workers Alliance shows, Black immigrant domestic workers are even more vulnerable during this crisis. More than 800 respondents in three communities — New York, Boston, and Miami-Dade County in Florida — show the scale of this crisis. As of June 2020, 65 percent reported being at risk of eviction or utility shut off in the next three months, 49 percent were fearful of seeking out government aid due to their immigration status, 45 percent had lost their jobs, and a quarter reported having their hours reduced.