The Short and the Long Arm of the COVID-19 Pandemic: Direct and Indirect Effects of the US Economic Lockdown

During the early months of the COVID-19 pandemic in the United States, as states began to implement business shutdowns to slow the spread of severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), Baker provided a dire estimate that 75% of US workers were employed in non-telework-friendly occupations and likely to either lose their job or risk exposure to SARS-CoV-2 at their workplace.¹ As highlighted by Baker, the group least likely to be able to work from home—characterized as workers whose interactions with the public are essential—was estimated to earn the lowest mean annual income, approximately $34 000 versus $66 000 for the most telework-friendly occupational group. This included workers in the retail, food service, beauty services, protective services, and transportation sectors.

INEQUITABLE BURDENS

Baker’s projection—that unemployment risk from the COVID-19-induced shutdown was highest among the most economically vulnerable—was indeed realized. Jobs in the lowest-paying industries represented 30% of all jobs but accounted for almost 60% of jobs lost between February 2020 and October 2021.² Those forced to select financial viability over sheltering in place faced elevated risks as they reported to work, with calamitous consequences. Toward the end of the first year of the pandemic (December 2020), frontline workers were 20% more likely to test positive for SARS-CoV-2 than nonfrontline workers.³ Those in the food processing industry had the highest elevated risk, with 45% higher odds of ever having tested positive.³ This pattern of exposure extended to mortality; workers in the accommodation and food services industry had nearly twice the COVID-19 death rate of workers overall and almost three times the rate of those in nonessential industries.⁴

Although inability to telework was clearly correlated with economic vulnerability, the striking stratification of the US labor force could just as easily be demarcated by other familiar taxonomies underlying the country’s social structure, notably race/ethnicity. The overrepresentation of racial/ethnic minorities in low-paying essential or frontline occupations foreshadowed the glaring inequitable burden and risks the lockdown would engender.

DISPROPORTIONATE HEALTH EFFECTS BY RACE/ETHNICITY

As of October 2022, age-adjusted mortality rates among Hispanics and non-Hispanic Blacks were 7.9 and 8.8 percentage points, respectively, above their percentage representation in the US population. By contrast, non-Hispanic Whites had a mortality advantage of 14.6 percentage points.⁵ Copious commentaries have postulated that the disproportionate representation in telework-unfriendly occupations, particularly lower-standing positions associated with a high risk of exposure, was a key driver of the excess COVID-19 case and mortality burdens among racial/ethnic minorities.

Although studies directly examining the role of occupation in generating racial/ethnic disparities in COVID-19 cases and deaths remain limited, multiple indirect connections have been documented: (1) workplace outbreaks erupted in industries in which racial/ethnic minorities are overrepresented, (2) per capita COVID-19 mortality disparities between essential and nonessential workers are estimated to be largest among non-Hispanic Black and Hispanic workers, and (3) racial/ethnic minorities are disproportionately represented in occupations with higher COVID-19 case and death rates.⁶ These observations, coupled with similar case fatality rates across race/ethnicity, are consistent with the hypothesis that occupation was a key (although by no means only) factor generating excess COVD-19 burdens in racial/ethnic minority communities.

THE LONG ARM OF COVID-19

As predicted by Baker, lower-income workers bore the brunt of the sudden and large economic shock brought on by the pandemic lockdown. In contrast to high-wage workers, whose employment rates remained virtually unchanged from February 2020 to February 2021, lower-income workers experienced an 11.7% decline in employment.⁷ Those who were unable to work because of the pandemic struggled to meet their basic needs, as evidenced by their substantially higher prevalence of food insecurity: 16.4% in December 2020, as compared with only 4.2% among those who were able to keep their jobs.⁸

Compounding the economic hardship, many Americans were faced with increased responsibility for caregiving, not only for sick family or household members but also for children as the result of school and day-care closures across the country. This added burden hit workers without sick leave and women (who disproportionately shoulder the responsibility of caregiving) the hardest. Emerging evidence indicates that the additional caregiving burden led to lowered productivity among women in comparison with men, resulting in possible setbacks in terms of career progression and future earnings.⁹ In the midst of these stressors generated from the shutdown, the United States saw a 9% increase in domestic violence.¹⁰

Economic losses among business owners were also unprecedented, with 22% closing doors in the first months of the pandemic.¹¹ Partly because of differences in demographic distributions across industries, racial/ethnic minority business owners disproportionately suffered; during the initial shutdown from February to April 2020, 41%, 32%, and 26% of the small businesses that stopped operating were Black, Hispanic, and Asian owned, respectively, as compared with 17% of those owned by White Americans, who make up 70% of business owners.¹¹

The COVID-19-induced shutdown also affected children. The proportion of US households with children that were food insecure increased for the first time since 2011.⁸ Furthermore, school closures represented an unprecedented disruption to children’s education and development, particularly for students from families of lower socioeconomic status. Those in high-poverty districts lost an equivalent of 66% of a year’s worth of achievement growth in math, as compared with 45% among students in low-poverty districts.¹²

POLICY RESPONSES

Few anticipated the depth and duration of the COVID-19 shutdown and its sweeping effects on income, education, familial responsibilities, and the very social fabric of society. Policy responses were exceptional in magnitude and depth. The Coronavirus Aid, Relief, and Economic Security (CARES) Act provided 80% of displaced workers more in benefits than they would have otherwise earned from work, resulting in a decrease in income inequality in 2020 relative to 2019.¹³ The expanded child tax credit reduced child poverty and childhood food insecurity by approximately 30% and 26%, respectively, alleviating the elevated rates observed earlier in the pandemic.^14,15 In addition, the Families First Coronavirus Response Act required employers with fewer than 500 workers (representing more than 99% of US businesses) to provide workers with paid sick leave or expanded family leave for COVID-19-related reasons.

Furthermore, health care services related to COVID-19, including tests and vaccines, were covered by the federal government, effectively providing free access to COVID-19 care. Baker argued that the outcomes of vulnerable workers would depend, in part, on whether workplace protections and related policies were enacted. These safety net expansions, among others, helped to mitigate the worst possible outcomes of the pandemic.

That our country’s most vulnerable experienced the brunt of the pandemic’s detrimental effects was not a surprise. However, few had predicted the extent to which advantaged groups would benefit. Investors in the country’s largest companies saw their wealth rise by more than a trillion dollars during the pandemic, and higher income workers now enjoy increased flexibility in the workplace with teleworking options.¹³

In contrast, lower-income workers have returned to prepandemic levels of economic precarity, living paycheck to paycheck with inadequate access to health care and no paid sick leave as expanded protections recede. Most of the federal protection programs have now ended, leaving many lower-income workers and their families at continued risk. Health care costs associated with COVID-19, including vaccinations, will likely no longer be covered by the US government once the current federally purchased supply is spent. The Families First Coronavirus Response Act expired at the end of 2020, and the expanded child tax credit and earned income tax credits have also lapsed. Paid sick leave is now neither required nor covered by the federal government.

LOOKING AHEAD

Barring new variants of concern, the current public health threat from COVID-19 has been greatly reduced in the face of widespread vaccination and decreased fatality rates. The US economy and daily life are slowly returning to their prepandemic states. However, the structural factors that engendered the gross inequities exposed by the pandemic endure; at the same time, safety net programs are being curtailed, returning at-risk populations to their prior levels of vulnerability.

The fallout of the COVID-19-induced shutdown made clear that the workers most essential to the US economy (i.e., those working in the food, health, and transportation sectors) are among the most vulnerable as well. The multisectoral spillover effects from the stay-at-home order also served as a reminder that socioeconomic policies and health policies are one and the same. Clearly, health and socioeconomic vulnerabilities in the United States are intertwined, and interactions between them need to be more forcefully recognized. Even absent a pandemic, many workers are just one major illness away from job loss and potential financial catastrophe.

Rather than returning to pre–COVID-19 levels, protecting workers requires maintaining and expanding social safety net programs that address the broader fallout of potential workplace disruption, including decoupling health care access from employment, increasing child-care and mental health support, and implementing more rigorous on-site worker protections, among others. As noted by Baker, the pandemic did not create disparities but exacerbated already existing ones. If we do not learn from this historical crisis, there is little doubt that similar inequities along these familiar lines will be revealed again in future pandemics.