The economic fallout of COVID-19 will expose our systems’ deepest flaws, fractures and inequities, but we can take action now to respond and rebuild.
Today we are globally focused on flattening the curve of COVID-19. Those fighting on the front lines are doing so without the resources they need. We lack PPE, hospital ventilators and beds, and solutions like paid time off and child care. Flattening the curve of COVID-19 requires a multi-disciplinary approach where healthcare, government, and community all play a role. But the impact of this pandemic extends far beyond the illness itself – and right now, another demand curve shows the secondary impacts of COVID-19 are already starting to surge.
While COVID-19 has sparked a recession, the comparison to the recession of 2008 falls short. The economic repercussions of COVID-19 will rival the Great Depression, and has already set off a chain reaction of unemployment, homelessness, food insecurity, increased suicide, opioid usage, and other social diseases – all in addition to the carnage COVID-19 will leave on our healthcare system and health system workers. Because the U.S. has long spent far more on health care and less on the essential resources that are actually critical to our health, we are starting at a deficit with our current social safety net – a system where the communities it serves are often left out of its design and decision-making, and a system that by no means meets the current needs of communities.
See the Story Behind the Curve
Food, a roof over your head, available health and mental health care – these are the essential needs that even before COVID-19 were not easily accessible for many. For the hundreds of thousands of people experiencing homelessness in the U.S. every day, sheltering in place has further threatened both their safety and accessibility to essential resources. In Boston alone, while nearly 40,000 students depend on free and reduced meals daily, only 13,000 received them last week – even with an enormous outreach effort. Community organizations and health care providers are scrambling, while layoffs are hitting the already fragile web of community support. And the demand for essential resources will grow. Many people who have never had to access services like food, housing or unemployment support are arriving at these doorsteps for the first time now.
The same way there has been a global call to action to “flatten the curve” of COVID-19 through interventions like social distancing, there must be a new call to action to ensure both our most vulnerable citizens and the millions that are about to join, have food, housing, health care, and other essential resources. It will take extreme short and mid-term interventions and long-term policy measures to flatten the upcoming essential resource demand curves. We also need to learn from history too – both the bright spots and the missteps.
A Living Wage
My great, great uncle John Ryan wrote in his book “A Living Wage” in 1906, “The doctrine that every laborer has a moral right to a living wage is obviously in direct conflict with existing business practice and theory.” He explained his belief that a laborer should “live in a manner consistent with the dignity of a human being.” At the time labor conditions in the U.S. were abysmal, with all power and money in the hands of employers. My uncle’s view was not popular with those in power, and he was labeled a “socialist,” “anti-business” and “against capitalism.” While he conceived of the idea of a “living wage” as a moral imperative based on Catholic social justice teachings, it would take unprecedented job loss and poverty during the Great Depression to implement this idea.
In 1938, Ryan helped architect the Federal Fair Labor Standards Act as part of the New Deal, establishing the concept of “a living wage” into policy. The idea of “a living wage” permanently changed the way our country cared for its workforce and even conceptualized “business.” The set of policies put forth by President Roosevelt in the New Deal became the foundation of modern-day social services. The New Deal was a highly innovative policy intervention that my uncle, President Roosevelt and its other architects used to flatten the social services demand curve that surged after the Great Depression. FLSA not only addressed the short-term surge due to the depression but addressed one of the underlying root causes of poverty that had been true since long before that unprecedented moment in our country. The New Deal, as a set of policies, while radical for the time and important for how we started to better care for laborers, was embedded with racism and sexism, and left out people of color and women.
Respond and Rebuild
The existing systems that support communities are already inequitable. Important programs such as the Women, Infants, and Children (WIC) Nutrition Program and free and reduced lunch have long served as band-aids to the root causes of our social ills, which include poverty, wealth inequality, and racism. The lack of addressing root causes combined with an inadequate social safety net has led this country to overly depend on health care institutions, nonprofits and philanthropy to fill the gaps in programs and services and try to influence systems change. Now, facing the current pandemic and inevitable economic downturn, these same institutions are being crippled when they are needed more than ever. In addition, many philanthropies are playing “conservatively” instead of throwing their power, wealth and influence to meeting this new set of demands of COVID-19 and its secondary impacts. As Dr. Comen Rojas wrote, “We can choose to support leaders across the country to imagine, try, create, and build what we know is possible: an equitable distribution of power, resources, and voice for all of us.”
We cannot wait until we have “climbed the curve” of COVID-19 to take care of our communities. We need to start the rebuild now. While the front-line health care and public health teams are working to address this virus, those of us focused on essential resources must work together to ensure there is local access to food, shelter, and mental health services for those that are at home, especially as we see the supply chain deteriorating. This moment in time demands a new level of collaboration, partnerships, and investment, not only in the band-aids but also in the root causes that have been in play long before COVID-19. These efforts must extend beyond a “stimulus package” to a rebuilding of systems – and ensure we are not replicating or reinforcing the deep inequities in how those health, justice and education systems operate. While this pandemic will put unprecedented pressure on our health care system, the aftermath – if we remain flat-footed – will further threaten the lives of not only our most vulnerable but the livelihoods of all Americans.
The Story Behind the Curve
We created the illustration above based on the following: unemployment rates projected to date; documented inequities in unemployment rates across race, gender and other categories; and what we know about the social services landscape and its capacity in relationship to essential needs prior to the pandemic.
- The story behind the curve is one of health equity. At baseline, the U.S. has large racial disparities across health outcomes, food insecurity, income and access to adequate housing and education. Moreover, during the 2008 recession, unemployment across race, gender, education level varied greatly. For example, whites had unemployment rates reaching 9.1%, whereas blacks had rates reaching 16.8 %.
- Unemployment levels are at unprecedented highs and are predicted to continue in this direction, with the St. Louis Fed projecting unemployment rate to reach 32%. High unemployment will drive an increase in essential need demand.
- We don’t know what the dip after shelter in place will be because there are too many unknown factors at play.
- We do know shelter in place is lifted and businesses reopen, some folks will either be rehired, return from furlough or be able to quickly get a new job.
- Unknowns in the magnitude and shape of the post quarantine dip include: impact of the CARE Act, how long the temporary policy responses such as eviction moratoriums, and changes to government benefit eligibility will remain in place, and how quickly the economy will recover.
As more data become available and are shared between researchers and analysts as well as practitioners and sector advocates on the front lines, visualizations can be updated and further inform detailed recommendations for structural interventions to social service ecosystems. We invite others to contact us with additional data, insights, and feedback so that we can collectively brace for potential impact and be part of the changes that need to be made to dismantle the forces that are embedded in these very illustrations.