Pandemic and household financial distress

Pew Research in September 2020 found that the adverse economic impact of the pandemic varied greatly by ethnic/racial groups. The graph below shows this disparity in term of difficult in paying bills.

Black and Hispanic adults are more likely to have drawn on government or charitable food resources since the outbreak began. Black adults (48%) and Hispanic adults (40%) are significantly more likely to say they have drawn on either of these resources since February than White and Asian adults (16% and 19%).

The disparity is, I believe, mostly driven by job wage and job security, and they are closely correlated with education status. Here is somewhat outdated (2016) data on educational attainment by race and ethnicity. The Pew Research report said that 47% of “lower income” households were laid off or had to take a pay cut, vs 32% of “upper income” households.

About a third of adults with a high school diploma or less education (34%) and 27% of those with some college experience say they have struggled with paying bills, compared with 12% of those with a bachelor’s degree or more education. About one-in-five adults with some college or high school or less education say they have had problems paying their rent or mortgage (18% and 23%) since the beginning of the coronavirus outbreak. Those with a high school diploma or less education are twice as likely as those with a bachelor’s degree or more education to have lost their health insurance in the same time period (6% vs. 3%).

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