- Recessions, like the one driven by the COVID-19 pandemic, are particularly devastating to communities of color.
- One way Congress can help soften the blow on communities of color is to extend the boosted $600 per week unemployment benefits, which expired last week.
- Congress should also make the program automatically renewing until unemployment remains below a pre-pandemic level.
- Arnab Datta most recently served as the Senior Legislative Counsel for Employ America.
- Indivar Dutta-Gupta is Co-Executive Director at the Georgetown Center on Poverty & Inequality.
- This is an opinion column. The thoughts expressed are those of the author.
- Visit Business Insider's homepage for more stories.
An overdue reckoning is sweeping America. The killings of George Floyd, Breonna Taylor and countless others have sparked a national conversation on police brutality and mass incarceration. As we grapple with these wounds, we must remember that structural racism damages these same communities every day without any damning videos, and without any guns drawn.
Our economic structures destroy Black and brown lives as well. As the recession and pandemic amplify existing inequities we must center economic policy on racial justice. Policymakers have a chance to do so right now by extending enhanced unemployment benefits that terminated last week. To advance racial justice, Congress must extend these benefits until employment recovers to pre-pandemic levels.
Recessions are particularly harmful to people of color
Communities of color have been particularly devastated by the COVID-19 pandemic. From a health perspective, Black and Brown people are dying at higher rates, partially driven by higher prevalence of underlying chronic conditions.
On the economic side, people of color are more likely to be essential and frontline workers, placing them at a higher risk for transmission. They are also more likely to work in the service, retail, and "gig" industries disrupted by physical distancing measures and reduced demand from our failure to contain the virus. A prolonged recession could create irreparable harm.
Recessions shatter communities of color. The Great Recession widened the racial wealth gap, with Black and Hispanic households losing nearly one-half and over one-third of their wealth, respectively, compared to under a quarter for white households. People of color suffer from the "first fired, last hired" problem: during recessions, they are laid off first and regain employment last. This recession is no different: despite May and June's jobs rebound, Black workers were still less likely to be rehired than white workers.
With soaring COVID cases and another round of business closures, many of these workers will see their jobs disappear and in turn look to the unemployment insurance system. Unfortunately, that system has also too often failed people of color and deepened racial disparities.
Of the 10 states where unemployed workers access unemployment benefits the least — often because of onerous barriers — seven have higher-than-average minority populations. An eighth, South Dakota, has a large Native American population. Southern states with sizable Black populations provide the least generous unemployment benefits, including Louisiana, Mississippi, and Alabama, where benefits make up less than 40% of lost wages.
Congress must continue expanded unemployment benefits until the economy rebounds
In wake of the COVID crisis, Congress took an important step to strengthen unemployment insurance by adding $600 a week to every unemployment check. It also created a new benefits program, Pandemic Unemployment Assistance, to reach some gig workers, the self-employed, and others who are excluded from the state UI programs. These benefits have kept families afloat across the country and are particularly lifesaving for workers of color.
While the Senate GOP dithered and negotiated their own position, the last of these payments went out on Sunday. They are now suggesting cutting the income of unemployed workers by $1,200 per month, despite record COVID cases. With the unemployment rate expected to remain above 10% well into 2021, Congress must do right by Black and brown workers to ensure they can survive when jobs aren't available. An "automatic stabilizer" design would achieve this.
Here's how it would work: rather than setting an arbitrary date at which the enhanced benefits would expire, Congress would tie expiration to a predetermined level of unemployment. For instance, the benefits would extend until the US falls below 5.5% unemployment for two straight months. Senators and Members of the House of Representatives have released a few plans that would work just like this — continuing the enhanced benefits at $600 per week for the duration of the public health crisis, and phasing them down as unemployment goes down.
This type of proposal is among the best ways to make sure that workers of color can weather an extended recession. With a higher likelihood of prolonged unemployment and limited wealth to rely on, Black and Brown workers are particularly vulnerable to the extension fights that accompany arbitrary deadlines. Craven politicians use these deadlines to delay negotiation, engage in theater and extract concessions at the last minute, all while the financial security of millions of Americans hangs in the balance.
This predilection to play politics with vital benefits until the last moment is not new. During the Great Recession, Congress nearly let additional benefits lapse five times. These renewal decisions seemed to depend on how the white workforce was doing; despite efforts to extend, Congress ended these benefits in 2014 when just 53% of the Black workforce was employed, compared to nearly 60% of the white workforce.
Afterward, the Black workforce never recovered to a similar level of employment, despite the longest economic expansion in history.
Congress can fix this. Tying enhanced unemployment benefits to an agreed-upon economic trigger is the best step we can take for workers of color in the age of COVID. It's an insurance policy against political failures that too often leave Black and Brown people behind.
A well-designed automatic stabilizer would set a clear goal to support workers until job opportunities return to pre-COVID levels or better. That's a goal that all Americans, whatever the color of their skin, can get behind.
This is an opinion column. The thoughts expressed are those of the author(s).
Do you have a personal experience with the coronavirus you’d like to share? Or a tip on how your town or community is handling the pandemic? Please email email@example.com and tell us your story.
Get the latest coronavirus business & economic impact analysis from Business Insider Intelligence on how COVID-19 is affecting industries.
Source: Read Full Article