How COVID-19 is making America’s income and race gap bigger

Don Lee –
The first symptom was diarrhoea. Then Mitchell Hughes had trouble breathing and broke out in a feverish sweat. By the time he recovered from COVID-19 this summer, the 52-year-old Black janitor in St Louis had missed more than a month of work and drained his $4,000 savings to keep up with the mortgage and other bills after his sick pay fell short.
He and his wife, Crystal Simmons Hughes, 53, a nursing assistant who cares for the elderly, made it through the illness but were left depleted and anxious about the resurgence in infections.
Unlike the Hugheses, Scott and Kristin Ladewig, a white couple who live about 15 miles away, have maintained their well-paying IT jobs from the relative safety and comfort of their home since March. They, too, are concerned about the future, especially for Kristin’s mum, who is in an assisted living home. But, financially, Scott, 51, and Kristin, 49, may be even slightly ahead.
So far the pandemic has left them with more money in their pockets as they save on car expenses, gas, lunches and other outlays. Their stocks have recovered and then some, and they have been able to invest some of their savings to make long-delayed home repairs.
About the only economic pinch they’ve felt is a temporary suspension of employer contributions to Scott’s retirement plan.
“To be honest, not really”, he said, when asked if he’d seen any negative financial impact from the pandemic. What’s true for these two hard-working, home-owning families is true across much of the nation.
Although their educational backgrounds and financial prospects began at starkly different places, the pandemic has only deepened the economic and racial divide between the two households, and countless others like them across America.
“The pandemic affects everybody. It pushes everybody back”, said Trina Clark, 48, who is Black and a regional manager for Microsoft in St Louis. “But we aren’t starting at the same starting line. We’re pushed back further.”
The health and economic crisis has been deeply personal for Clark. Two of her friends died from COVID-19 in September, one of them in her early 50s. A dozen other friends and people in her social network got the virus, she said, and a number of her relatives and family members, including her adult son, have lost jobs or seen significant pay cuts. There’s no question that the coronavirus has disproportionately affected lower-income people, particularly Black Americans, who not only have higher infection and death rates, but also face sharper employment and income losses.
— dpa

Job losses have fallen heaviest on restaurants, hotels and other services where people of color are overrepresented, and relatively few can do their jobs from home. Almost overnight, the health crisis has erased improvements in income and wealth equality that had begun to take hold in recent years, when unemployment for Blacks, Latinos and Asians dropped to record lows and more households in the bottom income tiers got in on the nation’s record-long economic growth.
In the St Louis area, home to about 2.8 million people whose average incomes are typical for the nation, finding work before the pandemic was not a problem for Mitchell Hughes, who briefly attended community college. The jobless rate in the area hovered around 2.5 per cent.
In April 2019, he signed on as a maintenance worker at Saint Louis University, cleaning a campus hotel for guests. The pay was not great, $12.62 an hour, and a recent raise was only about 25 cents more per hour. But thanks to a union contract, Hughes had medical and dental insurance, as well as an employer-matching savings plan. Working from home was never an option for Mitchell or Crystal, who is sent by a temp agency to care for the elderly in nursing facilities and other places.
“We were essential workers from the beginning,” Mitchell said in a telephone interview. “We didn’t get hazardous pay. We take the trash, do windows, doorknobs. We’re on the front lines.” – dpa