An article by Raad Sharar
The COVID-19 pandemic has not only resulted in a health crisis but is also responsible for the largest economic shock the world has experienced in decades (World Bank, 2020). This economic impact of the pandemic hit hardest the already economically disadvantaged racial minorities in several countries. This article will introduce with examples and statistics demonstrating how the pandemic has affected different races on the economic front.
The United States for a good while had the highest daily infection rate in the world, which compelled local governments to bring states under lockdown in order to curb the spread of the virus. While the White House celebrated the surprising jobs numbers, many Americans, especially people of color as well as women, lower-skilled workers, young people, or rural residents, remain unemployed and left behind by this immature “recovery”. Black, Asian, and Hispanic unemployment were all higher than the national average with Black and Asian levels actually increasing from the month before to 16.8 and 15.0 per cent respectively, while the rate for Hispanics, 17.6 per cent, was the highest of any racial or ethnic group (Goldin, 2020). The pandemic also brought about the mass practice of “working from home” or “WFH” as has been popularly abbreviated. However, even in that case, racial disparities were poignantly visible. According to the data from the U.S. Bureau of Labor Statistics (2018) Asian, Non-Hispanic and White workers have better opportunities to do their jobs from the comfort of their homes, compared to those of Black/African American and Hispanic/Latinx racial categories. A further exploration on the topic of how the pandemic affected telework in the context of race has been done in another article on this blog “Teleworking during the pandemic and access to it among different ethnic groups” by Iryna Burmina.
Household wealth can serve as a cushion against the economic uncertainties arising from the pandemic. The existence of a racial wealth gap means there is a difference in the ways different racial groups cope with these uncertainties. The black-white wealth gap in the United States can be seen as an example. In 2019, the median white household held wealth was 7.8 times greater than that of a typical black household. The average value of liquid assets held by a white household was $8,100, while the corresponding figure was $1,500 for a black household. This gap left black households far more vulnerable to economic shocks (Moss et. al, 2020).
The economic systems of the past were entrenched in slavery. At its onset, the colonial economic system consisted of plantation economies of North America and the West Indies that exploited slaves, which then transitioned from an agrarian based mercantilism to capitalist industrial production in England (Robinson, 2001). The current economic systems of the world, although have successfully shaken off slavery from their books, are still a continuous product of the system that was so embedded with slavery. The racial roles in the past economies can therefore be assumed to have had a significant contribution to the systematic divide in wealth between races that persists to this day.
Another aspect of detrimental economic impact was that which befell immigrant populations in several nations where evidence suggested there was a disproportionate effect of the pandemic between immigrants and Natives in several countries. Across the OECD, unemployment rates were higher among foreign than native-born individuals in almost two-thirds of countries. Immigrants were particularly affected in Southern European countries, Ireland and Austria, where employment rates decreased by at least 4 percentage points, at least twice as much as for their native counterparts (OECD, 2020).
Besides immigrants, refugees, who make up a large portion of racial minorities in many countries, have also borne the brunt of the devastating economic impact of the COVID-19 pandemic. The Norwegian Refugee Council (NRC) research found that these communities have suffered widespread loss of income since the pandemic started (2020). In NRC’s survey, “77 percent responded that they had lost a job or income from work, temporarily or permanently since March. The pandemic has also impacted other sources of income. Sixty-two per cent of respondents who had previously received remittances from family members abroad said they were receiving less than before the pandemic. As a result of these drops in income, 30 percent said that they had to borrow more money now than before the pandemic. The loss of income, coupled with limited access to social safety nets, a drop in remittances, limited saving potential and increased debt, is having profound combined knock-on effects on these communities” (NRC Report 2020: 3).
Racial disparities have been a harsh but existing phenomenon since before the pandemic. It is a phenomenon entrenched into the very roots of the structures and institutions of human existence starting (probably) from the days of European exploration, to systemic slavery, and to the present day. Racism and xenophobia have made their way into political, social and economic systems in the world. The pandemic only made clear the disparities that had already been existing across the economic systems of the world. This plays into Michel Foucault’s idea about biopolitics and further ties into the concept of race. According to Foucault in “The Will to Knowledge: The History of Sexuality”, technologies of control exist, to “ensure, sustain, and multiply life, to put this life in order.” Therefore, as biopolitics directly translates to the human body being controlled and subjugated by the “technologies of control”, the global economic systems in which all human beings are engaged can be assessed to be one such means of control. Foucault, in his lecture series, “Society must be defended” talks about how the most powerful race is the one with the ability and opportunity to define societal norms ensuing a war between the powerful race and those that go against the norm (1976). For Foucault, state racism is an essential characteristic of the modern biopolitical state. In the economic reality, of current times and the past, paints the picture of Foucault’s notion of state racism. The norms of these economic systems have always been dictated historically by one race while subjugating others. In the current reality, those same economic norms and the resultant disparity still exists making the backlash of the pandemic more severe on racial minorities across the globe.
References:
Cedric J. Robinson (2001) The Inventions of the Negro, Social Identities, 7:3, 329-361, DOI: 10.1080/13504630120087208
Goldin, Nicole. 2020. How COVID-19 is worsening America’s racial economic divide. Future of Capitalism. Atlantic Council.
Michel Foucault “The Will to Knowledge: The History of Sexuality” Volume 1 (1976) (trans. R Hurley, 1998).
Michel Foucault “Society Must be Defended” Lecture Series at the Collège de France, 1975-76 (2003) (trans. D Macey).
Moss, Emily, McIntosh, Kriston, Edelberg, Wendy, & Broady, Kristen. 2020. The Black-white wealth gap left Black households more vulnerable. The Brookings Institution. https://www.brookings.edu/blog/up-front/2020/12/08/the-black-white-wealth-gap-left-black-households-more-vulnerable/
NRC. 2020. “Downward Spiral: The Economic Impact of Covid-19 on Refugees and Displaced People.”
OECD. 2020. “What Is the Impact of the COVID-19 Pandemic on Immigrants and Their Children?” Tackling Coronavirus (COVID-19), no. October: 1–26.
The World Bank (2020). “The Global Economic Outlook During the Covid-19 Pandemic: A Changed World”.
U.S. Bureau of Labor Statistics (2017-2018), ”Job Flexibilities and Work Schedules”. Data from the American Time Use Survey. https://www.bls.gov/news.release/pdf/flex2.pdf