Why black workers face new economic risks amid COVID-19

Prosperity Now Vice President of Programs & Racial Wealth Equity Lillian Singh joins Yahoo Finance’s Zack Guzman to discuss how communities of color are being impacted economically by the coronavirus pandemic.

Video transcript

ZACK GUZMAN: But meantime, as we've been tracking the coronavirus impacts to the overall labor market, we have noted a discrepancy when you dig into what communities of color have been dealing with, noting particularly high levels of unemployment when we look at the Hispanic and black populations here in America, as well as the higher health impacts as well that shouldn't be overlooked in this discussion. And joining us now for more is Lillian Singh, Prosperity Now Vice President of Programs and Racial Wealth Equality. And I should note, Prosperity Now's mission is to ensure everyone in the US has a clear path to financial stability. So we appreciate Lillian taking the time.

And Lillian, I guess we'll just start with the numbers that you guys have been watching play out here when we talk about how this has impacted communities of color much more. What have you been seeing?

LILLIAN SINGH: Yeah, thank you so much for inviting me here to speak with you all today, to share the findings from our new report. And we share some of those findings in our new report "COVID-19-- New Crisis, Same Story-- Innovations to Racial Economic Equity From Leaders of Color on the Ground."

And your question is a good one. And the way I would like to frame it is to frame COVID-19 and what we're seeing around the data as a racial justice issue. The racial gaps we see in COVID-19 diagnoses and deaths are unacceptable but not surprising. In our report "New Crisis, Same Story," we shared the experiences of about 75 organizations of color from across 14 cities in 11 states that we partner with about how they're actually dealing with the shake down of that crisis, and what that really feels like in person.

So just to highlight a few of the racial disparities, this has been really a direct result of over a 400-year legacy of structural and institutional racism in this country. Decades of longstanding policies and systematic barriers have prevented African-Americans in particular and other families of color from being able to access quality health care, livable wage jobs, affordable and safe housing, and equitable education systems. And a lot of those disparities are rooted in some of these systematic barriers, Zack.

ZACK GUZMAN: Yeah, I mean, when we dig into the data, too, it just-- it's shocking to kind of see. Obviously labor force participation has been trending down when we look at the job reports. But for African-American populations here in the US, now below 50%, so fewer than half of African-Americans in the country with a job. Also when we note the unemployment rate, Hispanics and blacks well ahead of the white unemployment rate as well.

It seems that really economists have been highlighting this for a while. It's that communities of color would be first to get fired and the latest to get hired, kind of a phenomenon that we've seen even back when the Great Recession hit us. So, I mean, how does this kind of unwind all the progress that we've seen over that decade of job growth? And how long might that actually last in terms of how long the recovery will have to fix all of that?

LILLIAN SINGH: Great question. So what we know is that African-American people of color haven't actually recovered from the Great Recession. And the COVID-19 virus is actually causing for communities of color a pandemic within a pandemic. And a lot of those disparities that you are talking about in the labor market, the coronavirus is actually blowing those disparities wide open.

So what we know, just to talk about the labor market, what I would imagine, because this virus is actually very much correlated to black and brown people who are disproportionately working in the central-- in the surge jobs on the front lines, such as transit systems, food processing plants, grocery stores, retail stores, fast food chains. With the coronavirus shutting down cities and a lot of cities having stay-at-home orders, these are the same people who have lost jobs in this recession.

But at the same time, they're forced to be on the front lines. And they're continuously exposed to the coronavirus and the challenges of that, despite not having health insurance or paid sick leave. So what we know right now is that these challenges are going to continue until, like the previous segment was talking about, we have a vaccine.

ZACK GUZMAN: Well, let's talk about, too-- if we are seeing disproportionate impacts from all this, we have noted stimulus efforts trying to help those Americans that have been impacted by all this, whether you talk about stimulus checks. Notably, that has been proportionate, because it's mostly just applied to every community equally when we think about the check going out the door. So what are you seeing in terms of what's being done, maybe from nonprofits, even beyond the government efforts here to kind of I guess bridge the gap for a lot of the pain coming from COVID-19? How has that necessarily been playing out, maybe even nonprofits giving direct stimulus measures as well?

LILLIAN SINGH: Yeah, great question. So I want to commend America for the stimulus payments, right? It was a great response. Getting a lump-sum payment of $1,200 for a family in this country, particularly families who are asset-- living asset poverty is huge, right? And then an additional $500 for their dependents.

And I'll just break down really quickly what it feels like to live in asset poverty. That means that you don't have enough money in your bank account to survive three months without income disruption, right? So although we were able to get the stimulus payments out, what we failed to think about and plan for is that 14% of households of color are unbanked. And then roughly 30% of those households are underbanked.

So what does that mean, really, for families who are waiting for their stimulus checks? If they don't actually have a bank account, and if they didn't actually file taxes in the previous tax year and link their bank account to their-- and link their bank account number to their taxes, those families have not realized the stimulus payment, right? So millions of families are still left out of not even receiving the stimulus payment.

The other issue, frankly, with the stimulus payment is that the US Treasury, they tried to work around that by sending out prepaid cards, right? But the challenge with that is that it comes out looking like junk mail. So a lot of families who were actually supposed to be receiving these stimulus payments and being able to utilize them haven't been able to do so.

ZACK GUZMAN: Yeah, and I mean, just adding to all these complications, too-- as we've noted, a lot of immigrant communities also not necessarily-- if English isn't your first language, some issues there as well. But Lillian Singh, appreciate you taking the time to highlight all of these issues with us, Vice President of Programs and Racial Wealth Equality at Prosperity Now. Appreciate you taking the time.

LILLIAN SINGH: Thank you.