haves and have-nots
The COVID-19 recession is basically over for the rich and Wall Street, but not for the working class
Welcome to the "K-shaped" recovery.
The U.S. stock market has recovered most of its sharp losses since the COVID-19 pandemic hit the U.S. economy in February, housing prices are reaching new highs, and "jobs are fully back for the highest wage earners," The Washington Post reports, citing an analysis of Labor Department data by Opportunity Insights. "But fewer than half the jobs lost this spring have returned for those making less than $20 an hour," the federal supplemental unemployment checks keeping the jobless afloat have run out with no deal on the horizon, small businesses are shutting down nationwide, and lower-income renters are facing a wave of evictions.
"This has been a very clear K-shaped recovery," economist Peter Atwater at the College of William & Mary tells the Post. "The biggest and wealthiest have been on a clear path toward recovery. Meanwhile, for most small businesses and those worst off, things have only become worse. The contrast is piercing: One group feels better than ever while the other borders on hopelessness."
Employment for those making $14 an hour or less is still 20 percent below pre-pandemic levels, Opportunity Insights found, and Labor Department data shows that Black workers have recovered only about 20 percent of the jobs they lost during COVID-19, versus 40 percent for white men and 45 percent for white women. Households with children have also been disproportionately hit by the recession, the Federal Reserve Bank of New York found, especially single parents, 23.2 percent of whom lost their jobs during the pandemic.
President Trump has focused on the "tremendous" rebound on Wall Street. "We're in the middle of a pandemic and yet we're going to be hitting records," he told Fox Business on Thursday. The stock market recovery is driven mostly by Big Tech firms like Apple, Amazon, Microsoft, and Facebook, whose huge market values "carry the most weight in the S&P 500," The Associated Press notes. "The corner bars, the family restaurants, the hair salons, and other small businesses across the U.S. that are teetering or closing for good aren't listed on the stock market."
In fact, former Trump economic adviser Gary Cohn tweeted, "the stock market continues to reflect big businesses increasing their market share during #COVID19. If a small business closes, a larger business fills the void. We need to contemplate what this means for Main Street USA going forward. Is this really the future we want?"