If We Don’t Fight Inequality, Covid-19’s Effects Will Persist and Blight Our Future

By James A. Parrott and Lina Moe

A crisis, either personal or social, can clarify what tasks are important, what choices really matter, and what values are essential. That’s certainly true of the crisis New Yorkers face because of the Covid-19 pandemic.
Because on the social and economic front, here’s a paramount challenge we clearly face: Defeating the new strain of inequality that the coronavirus has introduced into the life of the nation’s largest city.
Accomplishing that must include creating new job protections and a new social safety net for the hundreds of thousands of dislocated workers, including undocumented immigrants, who live and work in our city.  
If we don’t, Covid-19 and its effects may well continue to blight our future for a very long time.
report we published last week details the devastating impact the Covid-19 epidemic has had on low-wage jobs in our city.
It shows that for restaurant workers and hairdressers – house painters and housekeepers – hotel porters and app-based for-hire drivers – and for other men and women working jobs now classified as “non-essential” in New York City – the business closings and social distancing measures  designed to stop the deadly coronavirus have produced catastrophic layoffs and losses of income.
And of the approximately 1.2 million city residents whose jobs we estimate will have vanished between mid-March and the end of April, roughly one in six – some 192,000 men and women – are undocumented immigrants. (Our research finds that another 73,000 or so undocumented workers have been or will be displaced from their jobs elsewhere in New York State.)
The sectors of the city’s economy hardest hit by job losses are largely what we identify as face-to-face services, led by restaurants and hotels (251,000 lost jobs), transportation and warehousing (155,000), non-essential retail (139,000), personal and other services (114,000), administrative and support services (100,000), and arts and entertainment (88,000).
These sectors encompass industries that rely very heavily on immigrant workers, including those who are undocumented. Counting both wage workers and independent contractors, 63 percent of all restaurant and hotel workers are immigrants. Immigrants are also 65 percent of construction workers, 72 percent of those working in personal services, and 77 percent of private transport workers.
Our research found that immigrants working in New York City are 20 percent more likely than their native-born counterparts to have been dislocated in the current crisis (30 vs. 25 percent).  And although precise numbers are understandably hard to nail down, we believe that layoffs have or will hit some 54 percent of the undocumented workers in the five boroughs – a rate twice the overall private sector job displacement rate.
Tragically and shortsightedly, these displaced workers have been left out of some of the key initial federal measures designed to cushion the blows of the Covid-19 economic contraction.
For example, the one-time payments of up to $1,200 per person most of us will (someday) receive won’t go to undocumented workers. That’s not because they’re not taxpayers; many faithfully pay income taxes to the IRS. But they do so by using “individual taxpayer identification numbers” (ITINs) rather than the Social Security numbers they’re ineligible for – and Congressional Republicans prevented ITIN holders from being able to receive these relief funds. Even “mixed-status” families with one ITIN wage-earner are ineligible if they file joint income tax returns.
Similarly, the Pandemic Unemployment Assistance Program created by Congress last month, which for the first time extends unemployment insurance benefits to independent contractors and other self-employed people, is closed to undocumented workers, whether they pay taxes or not.
State and local governments, aided by private philanthropies, are now attempting to fill in some of the unfair gaps in this Covid-19 safety net. Last week, California Governor Gavin Newsom said State government there  plans to distribute $500 apiece to some 150,000 undocumented adults who were left out of the one-time Federal cash assistance effort.  A group of charities has committed to raising another $50 million in private funds that would potentially offer benefits to another 100,000 people in California.
Also last week, the Open Society Foundations announced that it is granting $20 million to create an emergency relief fund providing direct one-time payments to up to 20,000 immigrant families in New York City who were excluded from the Federal relief program. Managed by the nonprofit Mayor’s Fund to Advance New York City and the Mayor’s Office of Immigrant Affairs, it will disburse $400 to individuals and $1,000 to families.
Recognizing that the pandemic’s economic fallout will not soon subside, New York State Senator Jessica Ramos announced this week legislation calling for ongoing payments to dislocated workers frozen out of other forms of economic relief—payments to continue for several months.
While these are welcome steps, they must be only the start of a broader effort to create a more just and humane city. Because as we concluded in our recent report, the coronavirus crisis has laid bare “in a more visceral sense than before the stark precariousness of most low-wage work. This involves not only low pay but poor or no health insurance, little or no paid leave, no on-the-job health and safety protections, and only a shrinking and tattered safety net to fall back on.”
“Precarious lives concentrated in crowded and poorly housed neighborhoods,” we warn, “have become an electromagnet in attracting the deadly virus.” If we don’t change those conditions, we may well all be living with that virus, and all its awful consequences, for a very long time.

James A. Parrott is director of economic and fiscal policies at the Center for New York City Affairs at The New School.

Lina Moe is a graduate student in economics at The New School. She is also a co-author of a recent Center for New York City Affairs report assessing the impact of New York’s $15 minimum wage.

Banner Photo by William A. Garcia.

Originally posted in Urban Matters.

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