The pandemic has accelerated these forces and heightened their impacts — as it has with so many other trends. COVID-19 has exacerbated economic inequality, with its adverse impacts borne disproportionately by the economically disadvantaged. The large-scale labor disruption that many had expected from the march of automation suddenly loomed large in the near term thanks to the economic disruption unleashed by the pandemic. But these developments have also increased awareness and urgency to act, and the pandemic is drawing attention to different models for developing more resilient social contracts.
Research by Oxfam estimates that COVID-19 could push half a billion people below the poverty line, setting the global fight against poverty back by more than a decade. Meanwhile, as stock prices and other asset values have continued to soar, the well-heeled have gained. Within the first few months of the crisis, US billionaires had added an estimated half-trillion dollars to their combined wealth.
A key reason for growing inequality is that COVID-19 has disproportionately affected the most vulnerable segments of society, because of key weaknesses in social contracts:
Health care inequities
As societies moved to tackle the pandemic, inequities in health care infrastructure and quality resulted in higher disease incidence and death rates among disadvantaged groups such as racial and ethnic minorities. Because of these underlying inequities, minorities are also often more likely to have preexisting chronic conditions, making them more susceptible to COVID-19. And, since these groups also have less access to health insurance coverage, they pay a greater economic cost when they are struck by the disease.
Inadequate worker protections
The working conditions of blue collar “essential” workers — from grocery store clerks to public transit employees and workers in meatpacking plants — have increased their exposure and susceptibility in this crisis.
Underlying inequities have left the working poor with little-to-no economic cushion for weathering such a deep crisis. Low wage workers typically have insufficient savings to afford unpaid time off. Sizeable population segments — from participants in gig economy platforms to informal sector workers in developing countries — lack both the ability to work remotely and safety net protections such as unemployment insurance.
Cramped living conditions
The living conditions of the poor have made them particularly vulnerable in this crisis, thanks to cramped quarters that make social distancing and home quarantines challenging, as well as relatively poor sanitation. Consequently, pandemic outbreaks have disproportionately affected such locations, from the living quarters of migrant workers in Singapore to slums in developing countries and poorer neighborhoods in American cities.
Momentum for change
The crisis has also boosted awareness of inequities and created widespread support for closing gaps and putting social contracts on a more sustainable footing, for several reasons.
First, as the pandemic gained widespread coverage in the news media, so too did the disproportionate toll it exacted on vulnerable populations. In an environment of heightened risk and uncertainty — and with the lives of loved ones potentially hanging in the balance — people tuned in to the news at a heightened rate and were more willing than before to venture outside their “filter bubbles” to find accurate information. As a result, people are more aware of economic inequities in the wake of the pandemic than they were before it hit.
Second, the pandemic brought home the reason why resilient social contracts are vital for social stability: living in a society means we are all connected. This truth becomes inescapable in a pandemic. Low wage workers who don’t have paid leave and can’t afford unpaid time away from work may be more likely to show up in the workplace even when they aren’t feeling well — endangering all of us. Individuals who don’t have access to health care may be less likely to get tested or seek treatment — endangering all of us. People living in cramped living quarters are hard pressed to practice social distancing — endangering all of us.