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Lower-income Americans were twice as likely to lose pay because of COVID than more affluent people, and it shows how the pandemic revealed long-running inequities

Juliana Kaplan,Jason Lalljee   

Lower-income Americans were twice as likely to lose pay because of COVID than more affluent people, and it shows how the pandemic revealed long-running inequities
  • The pandemic hit lower-income Americans and Americans of color harder, both physically and financially.
  • New research illustrates yet again the disparate impact of the virus on different groups.

COVID-19 has affected lives across the globe, but its impact isn't equally felt.

Two years of the pandemic have surfaced underlying inequities. Childcare closures and lack of paid leave have kept parents, especially mothers, from returning to work. Millions of workers found themselves suddenly unemployed, losing their income and navigating a labyrinth of unemployment claims.

At the same time, the wealthiest Americans added trillions to their fortunes. The divide between who could work remotely and who had to keep working in-person — and face direct exposure to the virus — was stark.

Now, new research from Brookings Institution researcher Ember Smith and Gallup economist Jonathan Rothwell offers a glimpse at just how uneven the physical and economic toll of COVID-19 has been. It's the latest data point that shows just how lower-income Americans, Americans of color, and Americans with lower educational attainment all bore a greater brunt of the pandemic's effects.

"In 2020, many vulnerable Americans were more likely to social distance or wear a mask," Smith wrote in an email to Insider. But they were "more likely to contract or die of COVID-19; more likely to face severe risk from contracting COVID-19, yet less able to work from home to avoid risk; more likely to work low-income jobs, yet more likely to lose them."

Poorer Americans were more likely to get COVID-19, and suffered a greater financial hit

The pandemic exposed a two-track economy that was already bubbling before 2020, where middle and high-income Americans were reaping the rewards of a booming economy and getting an increasing share of the national income.

Using zip-code-level COVID-19 case data, Smith and Rothwell find that lower-income Americans were more likely to live in areas that had higher COVID-19 infection rates — and deaths.

"A typical low-income worker (lowest income deciles) is four times more likely than a high-income worker (top decile) to work a job that requires close physical proximity," Smith said.

The Bureau of Labor Statistics found that higher-paid workers were also more likely to have access to paid sick leave in 2020.

Smith and Rothwell find a similar dynamic between income level and how likely Americans were to lose income in the pandemic. The lower the household income, the higher the loss of income: 51.7% of households with incomes of under $25,000 saw income loss, compared to 25.7% of households that earn $200,000 or more. And the higher the income, the more likely it was that household could work remotely.

Race and education also led to greater disparities

The impact of race on COVID-19 outcomes isn't easily extricable from income or education, the researchers say — and that's because structural racism has a powerful impact on both.

In the US, white people have much more wealth than their peers of color, but the gap is especially large between white and Black people. And that wealth gap has implications for the neighborhood one lives in, the schools they go to, and the jobs they have: factors that expose people to more economic and physical harm from COVID-19.

Black and Hispanic people are overrepresented in the lowest income bracket. Workers with a high school diploma or less were also 56% more likely to lose income compared to workers with a graduate degree, and Black and Hispanic people are much less likely than white Americans to have a master's degree or PhD.

And the same racial disparities exist when it comes to infection rates and fatalities.

That's because of the increased risk of exposure that people of color face: Black and Hispanic households tend to be more crowded, and Black and Hispanic people are overrepresented in service-sector jobs that require more contact with others. They also experience worse health care conditions.

"Black and Hispanic Americans faced higher odds of contracting, being hospitalized from, or dying of COVID-19 in 2020, even though they were more likely to engage in preventative behaviors like social distancing or mask-wearing," Smith said. "Racial income gaps may account for a substantial portion of the difference in contracting or being hospitalized from COVID-19, but there are still sizable racial gaps in infection and severity, even among those in the same income group."

There are also racial disparities when it comes to Medicare and vaccine access, the paper says: white and Asian Americans over the age of 65 are more likely to be Medicare eligible, and experience lower hospitalization rates. They're also more likely to be vaccinated than their Black and Hispanic peers, with the researchers saying that poor medical care for people of color and medical racism are likely responsible.


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