The COVID-19 Crisis
Authored by Pablo Aquiles-Sanchez, Laura Dresser, Alexis Econie, and Joel Rogers
Everything is New. Or is it?
In just six months, the coronavirus has burned a path of disease, grief, and death across the globe. It stretches health systems, some to the breaking point, shutters economies, disrupts public services, and fundamentally changes human interaction. The change in the nation and Wisconsin is breathtaking, relentless, and ongoing.
While the world feels transformed, transformation and disruption flow through well-worn channels.
COVID-19 has exposed and exacerbated long-standing, deep disparities that preceded the pandemic. A comprehensive review of the racial inequity of COVID-19 makes this clear. Compared to whites in the US, Black and Latino people are three times as likely to get sick and twice as likely to die from the disease. (New York Times, 7/5/20)
Even as the disease exposed deep disparities, the murder of George Floyd brought the racism of this nation into sharper focus. In response, a Black-led movement against police brutality in support of Black lives has ignited a broad and dramatic shift in the nation. Millions in the streets are demanding overdue and radical change in policing and criminal justice systems, rejection of the white supremist symbols and stories, and a new awareness of, investment in, and restructuring of policy in support of Black lives.
The unfolding pandemic, economic crisis, and national racial reckoning require a new approach to the State of Working Wisconsin, which COWS has released on Labor Days since 1996.
For 2020, the State of Working Wisconsin will be web-based, offering data updated each month to track economic indicators of COVID-19 crisis in the state. On the site, we also provide an overview workers’ experience in this new economic reality noting the unique ways opportunity has changed for unemployed workers, exposed workers, and those working from home. We fill in the picture with workers’ experiences. We will track emerging needs from new data sources. Because these serious economic challenges will require broad partnership and community wide discussion, we are amplifying the reports and releases of partners and engaging community leaders to provide insights and their thoughts on challenges and solutions for working Wisconsin.
Our approach is new, but we remain focused on the long-standing issues confronting working people in this state. Principal among these is extreme Black/white disparity in the state which activists and advocates have long documented. COVID-19 exposes and exacerbates these disparities. The movement for racial justice intensifies demands to eliminate them. In our July release, we center on Black workers, with profiles of three Black Wisconsinites who have been impacted by the pandemic. As the summer goes on, we will add more profiles, drawing on the experiences of workers across the state to show how COVID-19 is changing the state of working Wisconsin.
For decades, the State of Working Wisconsin has documented other serious problems for workers including the preponderance of poverty-wage jobs – jobs that cannot keep a family out of poverty, even with full-time, year-round work. Not only are wages low, in these jobs schedules are unpredictable and offer insufficient hours, but structured in ways that make a securing a second job impossible.
Further, the jobs often provide very few benefits, health insurance and paid sick leave are rare in these jobs. The pandemic has made the problems in these jobs much more evident, as vulnerable workers in some of our lowest-paid sectors are deemed “essential” but don’t have wages, benefits, or protective equipment to support health and safety in that work. We will use worker profiles and new data sources to continue our focus on issues in low-wage work in the COVID-19 crisis.
The State of Working Wisconsin 2020 brings COWS’ consistent attention to the challenges and inequities confronting workers in this state into the COVID-19 economic reality as it evolves. In the next sections, we describe how the crisis is reshaping work in Wisconsin and then discuss how it is also deepening existing fault lines and tensions in the economy.
Race in the Heartland
This report, plus its complementing Wisconsin’s Extreme Racial Disparity, provide a careful historical context and a broadly informed policy framework that are critical to winning greater racial equity throughout this region.
Understanding How COVID-19 Has Changed Work
The Covid-19 crisis has divided workers into three groups. The first group, workers who are have lost jobs and are unemployed. The second group is employed and exposed, workers whose jobs expose them to the virus through interactions with customers and co-workers. Finally, a third set has been able to take their work into their homes. These workers have the privilege of being able to earn a living without suffering exposure to the virus.
For everyone, work has been transformed by the virus; anxiety and stress related to jobs is on the rise across the economy. But the differences between these groups are substantial and challenges are unique.
1. The Job is Gone: Unemployed in COVID-19
For a substantial share of Wisconsin workers, jobs have disappeared. As jobs have gone, so does income and the health insurance that these jobs provided. For workers in hard hit industries, there is little hiring and skills may not transfer well to other industries. This is especially true for restaurant and hotel workers who were employed in an industry that has lost half its jobs in the early months of this crisis. For those in music and entertainment jobs, venues are closing through the end of 2020 and perhaps beyond. There is a sense that these jobs may simply be gone, at least for the duration of the health crisis.
Unemployment in February was relatively low at 3.5% and spiked during the crisis to a high of over 14%. Unemployment has fallen, down to 12% in May and further to 8.5% in June, the highest rate of unemployment experienced in decades. That 8.5% accounts for 260,000 people in Wisconsin who are seeking work, unable to find it, and are without income from work. Many are juggling bills, worrying about getting food on the table with the threat of eviction looming.
We do not yet have a perfect demographic profile of the unemployed in the state. Given that job losses were concentrated in leisure and hospitality, the frontline workforce in those jobs has experienced a disproportionate share of unemployment. Frontline leisure and hospitality workers are more likely to be women than men and are disproportionately people of color as well.
COVID-19 Challenges of Unemployment
The CARES Act enhanced and expanded Unemployment Insurance (UI), ensuring that more workers qualified for unemployment and that benefits levels were higher. These have been critical supports to hundreds of thousands of working Wisconsinites, keeping a flow of income to pay rent and keep food on the table.
This absolutely essential resource has had three serious limitations:
- Benefits can be hard to secure: Thousands of Wisconsin workers are in limbo, having filed for UI awaiting determinations and payment. The deluge of claims overwhelmed administration of the program. As of June 20, there were some 151,000 workers that had not received a final determination for claims filed over the course of the pandemic. (Wisconsin Public Radio, 6/29/20)
- Enhancements are ending soon: The CARES Act provided an enhancement in UI checks, increasing them by $600 per week. This enhancement will end at the end of July. This extra income was critical to the workers as the struggle to cover their basic needs as they search for work in the toughest labor market in generations.
- Some are left out: Workers without formal immigration status are not eligible for UI, in spite of the fact that their wages are garnished for UI taxes, just as all other workers. Estimates suggest that there are some 55,000 workers without legal status in the state and that these workers have contributed $112 million to Wisconsin’s UI trust fund. In spite of these contributions, none of these workers are getting UI. (Wisconsin Budget Project, 5/19/20). Not only are these workers excluded from UI, but they are also excluded from all federal safety net programs leaving them in a dire situation when they are unemployed.
Long Standing Challenge: Employer-Based Health Care When Work Disappears
“Nothing illuminates the problems with an employer-based health care system quite like massive unemployment in the middle of a highly contagious and potentially deadly disease outbreak.” – Jeneen Interlandi, New York Times
Among developed nations, the US is unique for employers’ essential role in delivering health insurance to the population. The system has long been problematic – it is expensive and produces lower health outcomes than many other systems across the globe. COVID-19 puts these limitations on full display. In a global health crisis, workers have lost access to health insurance as they’ve lost jobs. A recent report from the consumer advocacy group Families USA estimates that nationally 5.4 million workers have lost health insurance due to job losses during this crisis; 62,000 of those losing health insurance were in Wisconsin.
By extending and enhancing the nation’s Unemployment Insurance system, the CARES Act provided desperately needed income for millions of workers who lost jobs early in the pandemic. This income covered food, rent, and utilities, providing a sense of security in a time of chaotic change for workers who lost jobs. These payments also circulate throughout the economy, keeping others in business which is critical in this time of economic contraction.
At the end of July, the CARES Act UI enhancement of $600 will come to an end. For many unemployed workers these dollars were absolutely essential to maintaining a basic standard of living. If the national government does not find a way to extend this money, many of the unemployed will begin facing more desperate choices.
Further state and local governments are facing massive budget shortfalls. Without federal support, these governments will begin cutting budgets and laying workers off.
With COVID-19 cases rising throughout the nation and these problems on the horizon, the unemployed will face increasing financial stress, their ranks could grow substantially, and the economic downturn may get worse.
“March 11th. That’s when they told us we’re not going back to work until further notice. It was just crazy. It was like, oh my god, there’s no work.”
2. Essential (but often not paid like it): Employed and exposed
In March, the economy shut-down for all but essential services providing new insight to just what jobs are necessary for all of us to survive. Essential work has not been consistently defined (state’s shutdown orders differed on what was included), but consistently the jobs are essential to sustaining day-to-day life and workers doing them are exposed to COVID-19 through interaction with customers and coworkers. Health care, groceries, food processing and food service, transit, social services, logistics and delivery, building cleaning, and childcare are all commonly on lists of essential work.
Health care is perhaps the most obvious forefront of necessary and exposed work in a global pandemic. Hospitals workers – doctors and nurses, hospital cooks, building service workers, administrative and technical staff, and more – are all needed to treat both those who are sick with the disease and others as well. Other health system workers – in testing, clinics and doctors’ offices, physical therapists and other specialists, emergency transportation, pharmacists, equipment maintenance – have been on the frontline as well. Even months into the pandemic, health workers face shortages of personal protective equipment like masks and gloves that keep them safe in their jobs.
Equally essential in this health crisis have been workers in nursing homes and other long-term care facilities which have been the site of some of the nation’s most deadly outbreaks. Residents and workers at nursing homes account for more than 40% of all COVID-19 deaths in the nation and in the state. Deaths are overwhelmingly of residents, but staff in nursing homes have faced the pandemic often without sufficient protective equipment or the resources needed to keep themselves and their residents safe. The intensity of the spread of disease in long term care, alongside the very low wages and weaker health insurance and sick leave benefits for frontline workers, create very stressful working conditions during the pandemic.
“You are more in danger of getting the COVID-19 and then what are you going to do [for] work? If I get sick I can’t even go [to the doctor] because I don’t have insurance. I have not been sick, I can’t get sick…If I get sick I won’t have that income.”
Grocery stores, food processing, transit, social services, logistics and delivery, building cleaning services, and childcare workers have been deemed essential as well. Workers in these industries face exposure in their work, through interaction with coworkers and customers. These frontline essential workers are more likely to be women. Black and Latino workers are also over-represented in low-wage direct service occupations nationally and in the state (Center for Economic and Policy Research, 4/7/20).
Meat packing plants have been notorious COVID-19 hotspots with infections raging through the largely immigrant workforce. Policy choices have left meat packing and other low-wage workers without paid leave, strong workers’ compensation, and basic enforcement of health and safety standards. COVID-19 seizes these vulnerabilities and rages through these worksites. More on this here.
The crisis of low-wages is clear also in child care where workers earn just low wages, generally less than $11 per hour. (COWS research 5 years ago found wages around $10 per hour.) These are poverty wages. In a year of full-time work, many childcare workers earn less than it takes to keep a family out of poverty (see State of Working Wisconsin 2018 for a profile of poverty wage work in Wisconsin). These workers are literally essential to the ability of so many parents to work. Even so, their wages are low and their benefits are weak.
COVID-19 Challenges for Essential Workers
Workers who are exposed in their jobs need protection. They need to know they will have income when they stay home from work. They need to know they have the protective gear, information on the disease, and support of management in keeping safe at work.
- Paid Sick Leave: The Families First Coronavirus Response Act mandated paid sick leave for workers. This act is an essential first step to ensure that workers can take time off when they or family are sick. This is an absolute essential element of safety and disease prevention. Without this mandated benefit, many low-wage frontline service workers are forced to choose between income and health. These paid leave rules apply to worker until December 31, 2020. The need for workers to be able to stay home when they or family members are sick will not end at the end of the year. Workers, especially the low-wage service workers who rarely have paid sick leave, will need this legislation to keep themselves safe and to limit the spread of the virus (and other diseases) on into 2021.
- Personal Protective Equipment: To make their work safer and reduce transmission of COVID-19, essential workers need personal protective equipment and changes to work processes and cleaning procedures . For essential workers who are themselves at higher risk for the virus and those who live with family members at risk, safety at work is especially critical. The fear of bringing the disease home to a vulnerable loved one can be a heavy burden. To stay safe, workers must feel protected with equipment and systems that prioritize health.
- Worker Voice: To stay safe, and to keep worksites safe for co-workers and customers, essential workers need not only protective equipment and safe workflow, but also information on the virus at the worksite (i.e. when co-workers are ill) and job security if they see violations of safety rules by customers or co-workers.
Unions are a key force for this sort worker-supporting rule making on the job. Owing directly to Act 10 which undermined public sector unions and “right to work” which undermined private sector unions, Wisconsin workers are unfortunately less likely to be union members than workers in the nation as a whole.
As economies re-open, more workers will be moving back to worksites and the danger of exposure to the virus. Especially for those workers who are at higher risk and for those who live with vulnerable people, the risks of return to work are substantial. For low-wage service workers, high unemployment rates will reduce workers’ bargaining power for the foreseeable future. As a result, workers will need public infrastructure and policy — mandated sick leave, easy access to free testing, well-enforced protection from unsafe situations, and job protection for whistleblowers — to keep themselves, their families, and our communities healthy. State and federal policy that continues mandatory paid sick leave and clear rules on liability, information, and workplace provision of protective equipment, and extending free testing to essential occupations may be important places to start.
“It’s much riskier now and it’s not worth it. That’s another thing it’s not at all worth it. I know I’m gonna have to find a new profession.”
3. Shifting Work to Home: A paycheck and safety, but what about the kids?!
Our final group of workers are the most privileged workers in the COVID-19 context: workers who have been able to simply move their worksite into their homes. These workers have a paycheck and no risk of exposure from their work. Working from home is a luxury that just 30% of the workforce enjoys and white workers, workers with higher levels of education, workers with higher income the groups where this luxury is concentrated.
While there is real privilege in this group of workers, these workers, especially parents of young children and especially mothers face serious challenges as well. In Wisconsin, at the start of the crisis child care providers closed, K12 schools moved on-line from March through June, and this summer many summer camps and summer activities for children have shut down. This leaves workers trying to complete their fulltime jobs while also providing care and educational support for their children.
As of July 20, Milwaukee, Madison, and Janesville have all announced that K12 will be entirely on-line in September, at least through the first quarter of the school year. The stress for families is severe. There are no easy answers. As with K12, the child care industry in the state has been hard hit by the pandemic; keeping children safe in groups is daunting. Parents with school aged children will now face the impossible choices of last spring, seeking to balance work and school in the home, for those lucky enough to work in their homes. For those who must work outside their homes, finding care is likely to be very hard. The longstanding underinvestment in care and educational infrastructure in the economy has never been more evident.
What Has Stayed the Same: Wisconsin’s Inequalities Exposed and Exacerbated by COVID-19
The State of Working Wisconsin has consistently drawn attention to inequality and how it has grown over the last 40 years. Though this year, COVID-19 has changed the reality for workers in fundamental ways, we will close by noting ways that this crisis has made many of the long-standing problems more evident.
Black/white inequality: Wisconsin has long been among the most unequal states in the nation: the gap that divides white and Black measures of economic opportunity, educational success, and physical health is consistently among the highest in the nation (Race in the Heartland, 10/9/19). We know that nationally infection and death has been born disproportionately by the Black community. We know that front-line workers are disproportionately Black. We know that nationally, Black unemployment rates have continued to grow (even as the white rate fell slightly in the month of May). In Wisconsin, before the pandemic, Black/white disparity was extreme. National evidence suggest it has grown. COVID-19 exposes and exacerbates this inequality.
Latino/white inequality: We know that Latinos have also faced higher infection and death rates from the coronavirus and that Latino workers have suffered the brunt of outbreaks in meatpacking throughout the Midwest. We know that undocumented workers in the state are excluded from the public supports that have been essential lifelines for unemployed workers. While we will have to wait Wisconsin data on the COVID-19 impact on Latinos in the state, it is likely that COVID-19 has exacerbated these underlying disparities.
Gender inequality in wages and care: While we emphasized the need for care of children for the workers who are working in home, the crisis of childcare and of education in our communities touches all working families and those who are seeking work as well. For workers with work at home, the stress can be intense. But for essential workers, the lack of care actually keeps people from work. Without strong public support for and investment in child care infrastructure and for schools, working families will continue to struggle on this front.
Poverty wage jobs: The structure of our lowest wage jobs and the lack of protection for workers in them remains a critical problem. The pandemic has spread unemployment to tens of thousands of these workers who have never earned enough to save up sufficient cash to deal with long-term job loss. The original and generous UI rules that have helped these unemployed workers make ends meet over the last few months are coming to an end. For exposed and employed workers, COVID-19 makes the problems of basic equipment and basic protections and decent wages even more evident. Decent wages, predictable schedules, protection of health and safety – all of these were needed before the pandemic. The pandemic has exposed how desperately needed these things are.
COVID-19 has upended the State of Working Wisconsin. Workers’ lives and livelihoods have been reshaped in this global pandemic. This is a moment of upheaval and peril. Unemployed workers scramble for jobs, struggle to stay in house, and fear the future as unemployment insurance runs out. Essential workers face a contagious and fatal disease without a decent wage or facemask. Inside homes stress levels grow as workers try to stay safe, do jobs, educate children, and deal with the uncertainties that abound in our new reality. Our project will bring data, worker experience, and analysis to document the challenges to working Wisconsin that COVID-19 has brought.
COVID-19 has exposed many of the most pressing problems facing working Wisconsin. This report will continue to highlight the inequality and poverty-wage issues that have so long stressed working families in the state.
Perhaps most important, COVID-19 is changing the way we think about work, about relationships and distance, about what is essential, and about what our collective values are. If we can see how we are changing and how the economy is as well, perhaps we can also begin to grapple with and solve the collective problems that this crisis has made clear.