The Future of Inequality in a Post-COVID-19 United States
Four scenarios on the pandemic’s potential long-term impacts on inequality
Disasters are not great equalizers. Far from it. The legacy of disasters around the world has been greater socioeconomic inequality, not less, as the worst fallout is always endured by a society’s most vulnerable.
In this sense, the COVID-19 pandemic is no different. Already, the virus has had a disproportionate impact on those populations rendered most vulnerable by the structural inequalities long-present in US society. Our measures to combat the virus, too, are falling more heavily on the most vulnerable.
Where the COVID-19 pandemic is different is in its scale. While most disasters are local or regional in nature and tend to fade from the country’s attention even as the damage continues to mount in certain communities (hurricanes Katrina and Maria), the pandemic is affecting the whole country.
Countrywide disruptions are more likely to trigger the sort of societal responses that end up shaping developments for years and even decades afterward (the Great Depression/Dust Bowl, World War II, 9/11, etc.). The pandemic, and our responses to it, therefore, are likely to prove another historic pivot point for societal change, one that could lead either to a more equitable country as the structural inequalities highlighted (again) by the disease are reduced, or to a less equitable one as the ignored fallout from the pandemic and economic shutdown drives inequality higher.
Whether we can build a stronger country out of the aftermath of the pandemic depends on our ability to think more systemically and in longer timeframes than we are used to.
Thinking systemically and with foresight is especially important now that the push to return to business as usual is shifting into high gear. But returning to business as usual without working to address the structural factors that made people vulnerable to the pandemic risks both a resurgence of the virus in the short-term and a worsening of inequality in the long-term.
This article explores the interconnections between structural inequality and vulnerability to the virus and offers four scenarios for how inequality in the US could change in the years after the pandemic.
The Current Situation (and How We Got Here)
The health and economic impacts of the pandemic have been highly unequal. Black, Latinx, and Native American populations are all experiencing disproportionate rates of infection, hospitalization, and death from COVID-19. They are also losing their jobs or facing pay cuts in disproportionate numbers, and are more likely to have a harder time regaining those jobs and hours after the economic shutdown. The pandemic’s effects are also being felt along income, urban/rural, and age divides.
COVID-19’s Unequal Health Impacts
- By mid-April 2020, counties with higher proportions of Blacks (above the 13% share of the general population) accounted for 52% of all diagnoses and 58% of all COVID-19 deaths
- In New York City, death rates for Blacks (92.3 deaths per 100,000) and Latinx (74.3 deaths) were significantly higher than for whites (45.2 deaths) and Asians (34.5)
- In Detroit, Chicago, and New Orleans, Blacks accounted for more than 70% of COVID-19 related deaths, almost twice their share of the total population in each city
- 27% of Blacks say they know someone who has been hospitalized or died from COVID-19, compared to 15% of the general population and 13% of whites
- Native Americans made up 37% of all cases in New Mexico but only account for 9% of the population. In Arizona, they accounted for 21% of deaths but only 4% of the population
- The Navajo Nation has the highest per-capita rate of COVID-19 cases (18 per 1,000 persons) in the country, compared to New York’s 10 per 1,000.
COVID-19’s Unequal Economic Impacts
- 61% of Latinx adults report that they or someone in their household has lost a job or taken a pay cut due to the pandemic compared to 44% for Blacks and 38% for whites
- 52% of lower-income workers and 46% of workers without a Bachelor’s degree have lost their job or taken pay cuts, compared to 43% of the total working population
- Most Black (73%) and Latinx (70%) families do not have enough ‘rainy day’ funds to cover expenses for 3-months compared to 47% for white families. 77% of low-income families lack such funds
- The closing of casinos and other tribal businesses in Native American communities has cut tribal tax bases to virtually zero, disrupting funding of social services on the reservations
- Only 20% of Black workers and 16% of Latinx workers are able to work remotely
- Only 12% of the minority-owned businesses that applied for relief loans under the Paycheck Protection Program have been approved for loans, compared to 38% of small businesses overall
What’s behind these unequal impacts?
So why are certain populations more vulnerable to the virus than others? There are a number of immediate factors that together make minority, low-income, and rural populations more likely to become exposed to and have worse outcomes from the virus:
- Minority, low-income and rural populations tend to have higher rates of hypertension, diabetes, and obesity, all of which are associated with more severe COVID-19 infections
- Minority and low-income populations tend to be overrepresented in essential occupations that cannot be performed remotely and that often entail close-quarter working conditions
- Low-income and minority populations are more likely to live in larger, multigenerational households, making it harder to isolate vulnerable/infected family members
- Low-income and minority populations are more likely to live in food and health service deserts as well as in dense neighborhoods
- Low-income populations are more likely to go to urgent care/emergency rooms to access health services where the risk of exposure is greater than in standard health clinics
- Minority populations, especially Blacks, are more likely to face discrimination and disparities in care in healthcare settings. They are also less likely to be tested for COVID-19
- Immigrant and some minority populations are less likely to seek out health services at all
But these direct drivers of vulnerability only touch the surface of the problem — they don’t tell you why these populations are more likely to have comorbidities than others. To fully answer the question posed above, we have to dig deeper and look at the structural factors that underly the direct drivers. This brings us to the connection between inequality and the virus.
Structural Drivers of Inequality
Underlying the immediate factors behind vulnerability to the disease is a whole system of interconnected structural drivers of inequality that together generate and reinforce the outcomes that make minority, low-income, and rural populations more vulnerable to the disease and its economic fallout:
- Economic drivers — unequal employment (lower pay, less secure jobs, fewer benefits), less household wealth, increasing automation of jobs, less affordable housing being built, less access to credit, overrepresentation in hardest-hit industries (travel/hospitality, casinos, personal care, etc.)
- Education drivers — increasing cost of higher education, lack of support for completing programs once enrolled, private student loans
- Governance & regulatory drivers — less representation in government, racial gerrymandering, restrictions on ease of voting, incarceration over rehabilitation, weakening of social safety nets, policies driving residential housing segregation
- Health drivers — growth of health deserts and food deserts, cost and availability of insurance, long-term stress from discrimination and other trauma
- Social drivers — systemic and interpersonal discrimination that restricts opportunities (housing, credit, mortgages, employment, etc.),
- Technology drivers — the digital divide, internet deserts
Inequality in the US pre-COVID-19
Even before the pandemic struck, the impacts of these and other structural drivers of inequality were quite stark. Let’s look at two indicators that are tightly correlated with the drivers outlined above: 1) infant mortality, and 2) average life expectancy at birth.
In general, the greater a person’s income/wealth, the more educated they are, the better their access to health services and social safety nets, and the better the environment in which they live (natural and social), the healthier that person and their children will be. And when a person is excluded from these things? The poorer their own and their children’s health will be. Thus, if some groups are being marginalized from the structures that provide better outcomes, we should see such differences in infant mortality rates and average life expectancies.
Infant Mortality in the US (infant deaths per 1,000 live births)
Additional stats:
- The infant mortality rate (IMR) for Blacks (11.4) at the national level in 2016 was more than twice the rate of the non-Hispanic white population (4.9). For Native Americans and Native Alaskans (9.4), the rate was just about double
- At the state level, 19 states had an IMR for Blacks above 10, while no state had an IMR for whites above 8 in 2017
- Wisconsin was the state with the greatest disparity, with an IMR of 16 for Blacks and 4 for whites
- Rural counties have an average IMR of 6.69 compared to 5.49 for large urban counties
Life Expectancy at Birth in the US (average)
Additional stats:
- In 2014, the life expectancy of those in the top 1% of the income distribution was 14.6 years greater than for those in the bottom 1%
- In 2017, there was a 3.6-year gap in life expectancy between non-Hispanic whites (78.5 years, both sexes), and Blacks (74.9, both sexes). The life expectancy gap for Native Americans and Native Alaskans (73 years, both sexes) was 5 years
- Black males had a life expectancy gap of 7 years compared with white males
- From 1990–2016, the life expectancy of white men living in major urban areas increased by around 7 years, while for white men living in non-metro areas in Alabama, Mississippi, Tennessee, Kentucky, Arkansas, Louisiana, Texas, and Oklahoma, the increase was only 1.4–1.8 years
Exploring the Future(s) of Inequality in a Post-COVID-19 US
How might the COVID-19 pandemic impact inequality over the long-term? We know the pandemic is likely to change a lot of things, but the direction and extent of such changes are far from certain. It’s possible we come out of this crisis determined and able to successfully mend the structural inequalities the pandemic laid bare. It is also possible we fail in the attempt or never try in the first place and inequality continues to increase.
The long-term societal scenarios developed in this section represent four alternative futures that could emerge in the aftermath of the pandemic based on the choices we make today and tomorrow. The scenarios were built using a combination of current trends and drivers of change (direct and structural), sources of uncertainty going forward, key assumptions around the major dimensions of change, and the fallout from the shorter-term virus scenarios.
Sources of Uncertainty
There are three main sources of uncertainty when building post-COVID-19 scenarios:
- The virus itself — how the pandemic continues to unfold will have a direct impact on everything that comes after
- Our short-term responses to the virus and its socioeconomic disruptions — how we choose to combat the virus and help those impacted by it over the next several months will prove key to determining how much inequality worsens in the near term (this is likely unavoidable)
- Our long-term responses to the pandemic’s aftermath — what direction(s) we move in as a society to adapt to the post-COVID-19 world will shape inequality in the US for years to come
The table below highlights some of the specific uncertainties stemming from these sources and looks at potential impacts on inequality depending on their direction of change (green = reduced inequality, red = greater inequality, grey = neutral impact). For example, should immunity to the virus prove short-lived, we will have less time to rebuild/recover before another virus wave hits, which would likely make inequality worse as those most impacted by the first wave are also likely to need the most time to recover.
Key Assumptions Around the Major Dimensions of Change
How the uncertainties around our short- and long-term responses to the pandemic play out likely depends on the values of two dimensions of change (underlying factors): 1) the length of economic disruption from the pandemic; and 2) the level of social cohesion present in society during and after the pandemic.
The scenarios make some key assumptions about the future values of each dimension and the impacts those values might have.
Dimension 1: Length of Economic Disruption — How long will the current economic disruption last? Will there be a second (or multiple) disruption(s) due to virus resurgence?
Scenarios where the length of economic disruption is longer:
- Significant interventions into the economy more likely
- Much greater inequality, but greater popular pressure to address it
- Social unrest more likely
Scenarios where the length of economic disruption is shorter:
- Limited interventions into the economy more likely
- Increased inequality, but less pressure to address it
- Social unrest less likely
Dimension 2: Level of social cohesion — How willing are people to cooperate to achieve solutions? Do they have a propensity for collectivist or individualist solutions? Is there a strong or weak sense of solidarity within and between communities?
Scenarios where the level of social cohesion is greater:
- Collectivist solutions (from community-level to national) more likely
- Significant interventions into the economy and society are more likely to succeed due to greater public unity/support
- Social unrest less likely and greater trust between groups
Scenarios where the level of social cohesion is lower:
- Individualist solutions more likely
- Significant interventions into the economy and society are less likely to succeed due to fragmented public support, more targeted interventions aimed at helping only certain groups more likely
- Social unrest more likely and greater distrust between groups
Virus Lead-in Scenarios (6 months to 1 year out)
As the pandemic is still unfolding, the final building block for the long-term societal scenarios is a set four virus ‘lead-in’ scenarios that explore the different ways the pandemic could evolve in the US over the next few months to one year. Each of these virus scenarios has implications for the major dimensions of change.
See “A Lasting Legacy: Long-Term Implications of the Coronavirus Pandemic” for more detail on how these virus scenarios were created.
- The Next Wave — a new wave of the virus sweeps through the country in the fall/winter of 2020/2021 as environmental conditions grow more favorable and as social distancing ends and population immunity fade, triggering a second national economic shutdown. Coinciding with the start of the flu season, this second wave proves more deadly than the first as the health system is overwhelmed.
Implications for dimensions of change: Less Social Cohesion, Longer Economic Disruption - Whack-a-Mole — new virus hotspots continue to appear, especially in urban areas, as social distancing measures are eased, and as travels bring in new cases from hard to control hotspots in the world’s megacities. These new hotspots are increasingly able to be identified and contained through rigorous testing and contact tracing, but still result in local/regional economic shutdowns.
Implications for dimensions of change: Greater Social Cohesion, Shorter Economic Disruption - A Lingering Sickness in America — Many areas of the country return to normality after long-term declines in overall cases, but the virus continues to linger in disadvantaged communities in both urban and rural areas. The lingering cases combine with virus-induced long-term morbidities to overtax local healthcare systems in areas that were already hard hit and underserved. As most of the country goes about its business, the plight of disadvantaged communities is largely ignored.
Implications for dimensions of change: Less Social Cohesion, Shorter Economic Disruption - A Hard Fought Battle — widespread, accurate testing, antibody tests, effective treatments, and contact tracing curtail the virus enough for the US to fully, but still carefully, reopen. The arrival and deployment of an effective vaccine eventually sees the virus largely vanquished and many things return to the way they were before the pandemic but not all.
Implications for dimensions of change: Greater Social Cohesion, Longer Economic Disruption
Societal Development Scenarios (5 to 10 years out)
An increase in inequality is unavoidable in the short-term given the unequal impact of the current economic disruption and the pandemic’s unequal health impacts. The question going forward is, what trajectory do we let inequality take in the medium to long-term. The societal development scenarios in this section suggest four potential pathways for inequality over the next 5 to 10 years. These are by no means the only pathways, of course. Scenarios are important thinking tools that can help spur policymaking. Reality is likely to include elements from all four scenarios. Scenarios 3 and 4 may seem more likely than the others given current trends, but all are possible depending on our actions.
The 2×2 diagram shows how each scenario fits within the major dimensions of change of the scenario space and which COVID-19 scenario leads to which Societal Development scenario.
Scenario 1: Community Gardens
The programs and efforts required to successfully contain repeated local COVID-19 outbreaks give rise to a lasting infrastructure of more effective community-level health and social service networks. Similarly, a combination of community building and local and national policy solutions ends the economic disruption and strengthens local economies through a greater emphasis on locally produced goods and food and an expansion of social safety net programs and community opportunity programs (infrastructure, training/education).
Dimensions of Change:
• shorter economic disruption
• greater social cohesion
Lead-in COVID-19 scenario:
• Whack-a-Mole
Assumptions:
• more effective government
• local solutions favored
• decentralized health system
• stronger social safety nets
• severity of education and work gaps is less
Implications for inequality:
Community-building programs slow the increase in inequality and then reverse it over the medium- to long-term, eventually reaching pre-COVID-19 levels
Scenario 2: A New Great Society
The battle against the virus and its fallout proved significantly harder and longer than expected. The extensive national-level emergency programs required to finally contain the virus and reverse the deep economic disruption generates significant public support for an empowered federal government able to take a much larger role in the economy and society to ensure both that such a disaster doesn’t happen again and to ensure a more level socioeconomic playing field going forward. To create a more level and resilient economy, the government enacts new safety net programs, including Universal Basic Income, and undertakes significant public infrastructure programs. To enhance population health and resilience, the government also moves to nationalize the healthcare system to remove the profit motives currently driving the health industry. Finally, the government institutes a new national public service to increase resilience to disasters and to keep support for federal expansion.
Dimensions of Change:
• longer economic disruption
• greater social cohesion
Lead-in COVID-19 scenario:
• A Hard Fought Battle
Assumptions:
• more effective government
• national solutions favored
• centralized health system
• stronger social safety nets
Implications for inequality:
A significant reduction in inequality over the medium to long-term as national programs kick in. Inequality reduced below 2019 levels in the long-term
Scenario 3: Swept Under the Rug
The pandemic largely fades from public attention as much of the country gets back to work and normal life. But COVID-19 hasn’t gone away. The virus continues to ravage vulnerable communities across the country. Efforts to address these lingering hotspots fall victim to decimated local and state budgets, the continued consolidation of the health system away from vulnerable areas, and a disinterested federal government. The federal government instead focuses on spurring economic growth through deregulation and applying austerity measures to social programs. The result is an uneven economic recovery that leaves many workers and communities behind and expanding health and food deserts that leave more people vulnerable to the next disaster. Protests and social unrest break out in many of the left-behind communities, but they do not sway the general public and instead deepen partisan and urban/rural divides.
Dimensions of Change:
• shorter economic disruption
• lower social cohesion
Lead-in COVID-19 scenario:
• A Lingering Sickness in America
Assumptions:
• less effective government
• deregulation favored
• centralized health system
• weaker social safety nets
• severity of education and work gaps is greater
Implications for inequality:
Continued moderate increase in inequality above 2019 levels across the time horizon.
Scenario 4: Boiling Point
The pandemic and its fallout lasted longer and proved significantly harder to deal with than expected. The required extensive national-level programs never materialized in the face of government dysfunction and increasing distrust in government solutions. Afterward, the federal government takes a hands-off approach to addressing the country’s economic and population health, pushing heavy deregulation while allowing social safety nets to erode further or go unfunded and for rural and low-income health systems to collapse. The effort for local and state governments to make up for the federal government’s shortfalls prompts more protests. Federal power is not wholly lost, however. Societal surveillance programs continue to expand and controls over immigration and naturalization continue to be strengthened. Civil unrest breaks out in many urban areas as a growing segment of society falls through the widening cracks in the system.
Dimensions of Change:
• longer economic disruption
• lower social cohesion
Lead-in COVID-19 scenario:
• The Next Wave
Assumptions:
• dysfunctional government
• deregulation favored
• centralized health system
• weaker social safety nets
• severity of education and work gaps is greater
Implications for inequality:
Continued significant increase in inequality above 2019 levels across the time horizon
The graph below provides a visual of how each scenario might impact inequality going forward. This is merely a conceptual diagram. The suggestion is that inequality will increase in the short to medium-term regardless of the scenario, but the rate of that increase will differ greatly by scenario. It also, realistically, suggests that even in the scenarios that see reductions in inequality, those reductions will take a long time to achieve.
Takeaways
- Long-term structural inequalities have left minority, low-income, and rural populations significantly more vulnerable to COVID-19 and its economic fallout
- Socioeconomic inequality in the US will get worse over the next few years — this is unavoidable giving the current economic disruption and the likelihood that COVID-19 will continue to prey on vulnerable populations until the broad rollout of an effective vaccine
- This rise in inequality can be reversed over the longer-term, but only through careful policy-making and sustained efforts at all levels of society
- There is a real risk the pandemic will have a generational impact on inequality as minority and low-income children fall behind their peers
- Many children in vulnerable populations have lost precious education time and are now more likely to experience increased stress and financial hardship, growing up in households that have suffered job losses and pay cuts or even the loss of a parent
- COVID-19 has highlighted just how vulnerable our society is to disruption. The scenarios explored here point to the importance of building societal resilience through community- and national-level policies, as well as the danger of leaving structural inequalities unaddressed
- Enhancing societal resilience (economic, health, education, governance, etc.) is vital, not only for recovering from this pandemic but to ensure that future disasters (natural and manmade) are less damaging
- How we choose to adapt (or not) to the post-COVID-19 world will shape inequality in the US for years and even decades to come
