No Shelter From The Storm
This week we provide an update on material hardship in families with young children during the pandemic. We look at overall trends in our nationally representative sample of households with young children and the extent to which household income going into the pandemic has protected families against material hardship. We also examine how experiences of material hardship differ between groups of families.
Key Findings
Not surprisingly, families with lower household income before the pandemic have experienced more material hardship during the pandemic than those with higher income. We do not see notable differences since the pandemic began among lower income families based on race and ethnicity.
Having a higher income before the pandemic has not protected all caregivers from material hardship. Upper- and middle-income families’ experience of material hardship is highly dependent on their race/ethnicity. Higher income Black and Latinx households face more material hardship than White families with similar levels of pre-pandemic income. This finding underscores structural racial inequalities faced by Black and Latinx families with young children.
Background and Methods
The economic impact of the pandemic on American households has been overwhelming. Material hardship (i.e., difficulty paying for basic needs such as food, housing, and utilities) has increased dramatically since the beginning of the pandemic. According to a recent survey, 46% of all households have experienced significant material hardship since April 2020. Media reports indicate that these experiences have worsened since the CARES Act and its $600/week unemployment supplement and other benefits expired at the end of July.
In previous posts, we have reported on structural inequalities and material hardship among families with young children during the pandemic. Our data show that Black and Latinx households have been experiencing more financial difficulty and material hardship than White households. These differences seem to be independent of income. In fact, we found that differences in experiences of material hardship between Black/Latinx households and White households was most pronounced among middle and upper income families.
This week, we provide more detail on how families’ experiences with these issues has changed over time. We look at the extent to which being of middle/upper income prior to the pandemic has protected families with young children against material hardship challenges since the start of the pandemic, and whether this potential buffering effect differs across Black, Latinx and White households.
We categorized all the households with young children in our survey as either middle/upper or low income (split at 150% of the federal poverty line for household size) based on their self-reported household income in 2019 before the pandemic. We have measured material hardship in weekly surveys since April 2020 by asking families to indicate whether they are having difficulty paying for basic needs in one or more of the following categories:
Food
Housing (mortgage or rent)
Utilities
Childcare
Medical Care
Social Support
Emotional Support
Other
What do the data show?
In our most recent survey, fielded on September 8th, nearly 40% of all households in our sample reported that they were currently experiencing material hardship. This corresponds closely to the proportion who stated in our mid-August survey that they were anticipating encountering such hardship in the next month. In other words, caregivers’ anticipated concerns a month ago about the material hardship they would be experiencing have now come to pass.
Caregivers in families with lower income before the pandemic have felt more material hardship than those with higher pre-pandemic income.
In addition, we find the following:
Nearly two-thirds of households with low income before the pandemic have reported at least one material hardship on a regular basis since the pandemic began.
Low-income households of all types appear to be having these experiences; White, Black, and Latinx families who were low-income before the pandemic are experiencing similar levels of material hardship during the pandemic.
Notably there are some differences in trends across low-income groups, with material hardship increasing over time for low-income Latinx households but remaining stable for low-income White and Black households.
Many caregivers in high-income households are also experiencing material hardship, but this is highly dependent on race/ethnicity.
As shown in Figure 1, the percentage of caregivers in White high-income households who report at least one material hardship has hovered around 20% since the pandemic began. Notably, rates of material hardship for White high-income families have increased somewhat since the CARES Act unemployment benefits and eviction moratorium expired. Although this increase is small, it suggests that being middle/upper income before the pandemic has not fully protected White families from difficulties in meeting basic needs.
In Black middle/upper-income households, the percentage of caregivers reporting at least one material hardship has remained around 40% since the beginning of the pandemic. Being middle/upper income going into the pandemic has not protected Black caregivers from financial stress in the same way that it has for White caregivers.
Approximately half of Latinx households with higher pre-pandemic income were experiencing at least one material hardship early in the pandemic. These rates have increased over the course of the pandemic. Being middle/upper income going into the pandemic has not protected Latinx caregivers from financial stress to the same extent as it has for White caregivers.
These findings point to how existing structural economic inequalities, which were well documented within Black and Latinx communities prior to the pandemic, are worsening. The pandemic appears to be exacerbating and amplifying these structural racial inequalities.
Implications
Being of middle- or upper-income at the start of the pandemic has helped some caregivers meet financial challenges and provide basic needs. However, a higher income has not guaranteed protection for families with young children; a large number of caregivers across our entire sample are not able to pay for their families’ basic needs. Furthermore, pre-pandemic income is not having the same protective function across all families. Black and Latinx families with higher incomes are facing more material hardship than White families with similar incomes.
Our data do not allow us to answer the question of why middle/upper income Black and Latinx families are experiencing more material hardship than White families with similar pre-pandemic incomes. One possibility is that, Black and Latinx families, on average, have less savings and overall wealth than do their White counterparts. This wealth gap has been documented extensively elsewhere. It may also be because Black and Latinx caregivers have lost jobs during the pandemic at a disproportionately higher rate than caregivers in White families. Alternatively, as documented in prior research, Black and Latinx middle and upper income caregivers may be providing financial support to extended family members at higher rates than White families, putting more of a strain on existing income.
Our data are consistent with other surveys showing that the coronavirus pandemic has disproportionately impacted people of color and worsened existing racial inequality. Black and Latinx households are losing more jobs, receiving lower quality distance learning, and are getting sick and dying as a result of COVID-19 at higher rates than White households. Our data show that, on top of these established disparities, middle- and upper-income Black and Latinx caregivers with young children are experiencing more consistent and ongoing stress in meeting families’ basic needs than White caregivers with similar income levels. This is clear evidence of structural racial inequalities among households with young children.
Recommendations
Policy makers must pass legislation to aid in identifying and supporting all US families experiencing material hardship. Even in subgroups such as middle/upper-income White households, the growing proportion of households experiencing difficulty paying for basic needs is cause for great concern and must be addressed.
In many other subgroups, including all lower-income households and Black and Latinx middle/upper-income households, the elevated levels of material hardship we observe in our survey are harbingers of long-term societal impacts from the pandemic. Extensive scientific evidence and our own survey data show that these stressors can have lasting impacts on both adults and children.
Our results indicate that policy makers must make more relief available to Black and Latinx households, including those who were middle and upper income before the pandemic.
Additional readings
The Impact of Coronavirus on Households in Major U.S. Cities. NPR.
Study: COVID-19 pandemic exacerbated hardships for low-income, minority families. AAP News.
The Pandemic Recession Is Approaching a Dire Turning Point. The Atlantic.
Examining the Black-white wealth gap. Brookings.
Racial Economic Inequality. Inequality.org
COVID-19’s Disproportionate Effects on Children of Color Will Challenge the Next Generation. Urban Institute.
How The Crisis Is Making Racial Inequality Worse. NPR.
Extended-Family Resources and Racial Inequality in the Transition to Homeownership. PMC.
Family Members in Need: Why Some Middle Class Blacks Can’t Get Ahead. The Society Pages.
Despite A Growing Latino Middle Class, California Families Face Hurdles Getting There. kpbs.
The Economic Fallout of the Coronavirus for People of Color. Center for American Progress.
Structural Racism. Race and Public Policy Conference.
How rising U.S. income inequality exacerbates racial economic disparities. Washington Center for Equitable Growth.
About the project
When the COVID-19 pandemic emerged last winter, there were over 24 million children age five and under living in the United States. This period of early childhood is a critical window that sets the stage for health and well-being across the lifespan. As such, it is essential during the current health and economic crisis to listen to the voices of households with young children.
The weekly survey of households with children age five and under launched on April 6, 2020. Since then, we have been gathering weekly data about child and adult emotional well-being, financial and work circumstances, availability of healthcare, and access to child care/early childhood education.
These analyses are based on responses collected from 8303 caregivers between the dates of April 06, 2020 and September 24, 2020. These caregivers represent a range of voices: 10.33% are Black/African American, 19.81% are LatinX, and 27.45% live at or below 1.5 times the federal poverty line. Proportions/percentages are calculated based on the item-level response rates, not out of the total sample size. The data for these analyses are not weighted.
We will continue to report on these issues as we learn more from each new weekly survey. We will also be producing policy briefs that make concrete recommendations about how to address the challenges we are seeing emerge from the family surveys.
Our goal is to use what we are hearing from families to improve the well-being of all households with young children, during the pandemic and beyond.
Suggested Citation
Center for Translational Neuroscience (2020, September 28). No Shelter From The Storm: Higher Income Isn’t Protecting Black And Latinx Families From Financial And Material Hardship During The Pandemic. Medium. https://medium.com/rapid-ec-project/no-shelter-from-the-storm-88e290dad8e6