The pandemic health and economic crises have contributed to a further widening of long-standing economic, racial, and gender divides.
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 $2.071 trillion (70.3 percent) between March 18, 2020 and Ocobter 15, 2021, from approximately $2.947 trillion to $5.019 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 123 percent increase in their combined wealth during this period, from $349 billion to $779 billion. We will be regularly updating this analysis here.
Forbes and U.S. Bureau of Economic Analysis data shows that U.S. corporate after-tax profits hit a record high of $2.5 trillion in the third quarter of 2021, further enriching wealthy executives and shareholders. One factor behind the profits spike: giant corporations have used the excuse of pandemic-related supply chain bottlenecks to jack up prices for gasoline, food, and other essentials.
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.
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 December 2021, average hourly earnings in the leisure and hospitality sector, which includes restaurants and hotels, were up 19.1 percent over the previous year. In the education and health sector, workers had wages up by over 5 percent, and retail workers were pulling in almost 9 percent higher wages than last year.
While gaps have eased, global vaccine distribution remains highly unequal, in large part due to the pharmaceutical industry’s opposition to efforts to relax patent monopolies and allow affordable production in developing countries. In January 2022, the number of vaccine doses administered per 100 people was almost than 13 times higher in high-income than in low-income countries, according to data from the WHO and the World Bank. By November 2023, this gap had narrowed but rich countries had still distributed more than four times more doses than low-income nations.
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 2020, 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.
According to APM Research Lab, white and Asian Americans have substantially lower Covid-19 mortality rates than those of other racial and ethnic groups. Between the start of the pandemic and October 2, 2022, indigenous people suffered 582 deaths per 100,000 people – more than twice the death rate for whites and Asians.
People of color are more likely to suffer severe illness from Covid-19, regardless of their age. According to CDC data, hospitalization rates have been highest among indigenous and Black Americans. About 2,100 indigenous and 1,700 Black Americans were hospitalized for Covid-related symptoms per 100,000 people in their respective ethnic and race groups between the beginning of the pandemic and October 22, 2022.
The racial disparities in Covid-related health indicators have contributed to a steeper decline in the U.S. life expectancy for people of color, according to data from the National Center for Health Statistics and the CDC. Between 2019 and 2021, American Indians and Alaska natives experienced the biggest drop, with life expectancy at birth plunging by more than 6 years to 65.2. The Latino and Black communities both experienced a drop of four years, while Asian and white Americans have seen a decrease of about two years since the start of the pandemic.
The pandemic-related economic crisis in 2020 was particularly devastating for people of color. When the shutdown sent unemployment levels skyrocketing in March and April of that year, Black and Latino workers were much more likely to be jobless than white workers, according to BLS data. This remained true despite the fact that people of color made up a disproportionate share of essential workers who had to remain on the job at the start of the pandemic. While the overall unemployment rate has dropped significantly, racial disparities remain. As of October 2023, the unemployment rate for Black workers was 5.8 percent, compared to just 3.9 percent for U.S. workers as a whole.
The Covid-19 pandemic has increased the share of U.S. workers who are teleworking for health reasons, but not everyone has the same ability to work from home. According to the Centers for Disease Control and the National Institute for Occupational Safety (NIOSH) and Health, Black and Non-white Hispanic workers are less likely to report being able to telework than white and Asian workers. Some 38 percent of Asian workers and 24 percent of white workers reported working from home between May 2020 and July 2021. By contrast, only 19 percent of Black and 14 percent and Non-White Hispanic workers reported working from home in that same time period. The researchers attributed 80 percent of this divide to racial education gaps, since college graduates are more likely to be able to telework. Workers of color with public-facing jobs have been exposed to greater virus risks.
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.
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.
The drop in labor force participation caused by the pandemic hit women of color hardest, particularly in the first two months, when Hispanic/Latina women’s participation rate plunged by 5.8 percentage points and Black women’s dropped 4.6 points, compared to 2.7 points for white women. While many women have re-entered the workforce, racial gaps remain. As of September 2022, white women’s labor force participation rate was 1.2 percentage points below the pre-pandemic peak, while that rate was down by 2.0 percentage points for Black women and 1.5 points for Hispanic/Latina women.
Although research on transgender people is sorely lacking, available data make clear they have been particularly vulnerable to the Covid-19 pandemic. According to 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 showed 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.
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.