COVID-19 Disruptions by Race, Ethnicity and Geography: An Update

July 21, 2022

An April 2021 blog post by Nishesh Chalise and Violeta Gutkowski used 2020 survey data to highlight the pandemic’s impacts on low- to moderate-income (LMI) communities, focusing on disparities between rural and urban as well as those between race and ethnicity. How have those communities fared since the initial shock of COVID-19 in 2020?

Using data from the 2021 Community Impact Survey (CIS), today’s post—the first in a two-part series—shows that even after 18 months since the pandemic’s onset, most of the earlier findings were still present. LMI communities of color continued to report more significant disruptions from the pandemic than those experienced by LMI communities that are primarily white.The Community Impact Survey asked providers this question: “Does the entity you represent primarily serve a community of color?” In this blog post, communities that were not reported as being communities of color are described as “primarily white.” Additionally, the data revealed no major disruption disparities between urban and rural LMI communities once race and ethnicity were considered.

First, communities of color were more likely to continue to report greater disruption than white communities. This finding is consistent with the April 2021 blog post, in which the authors showed that 90% of service providers to Black or Hispanic communities reported significant disruption, compared with less than 70% of entities serving white communities. Service providers include nonprofits, financial institutions and public entities.

Second, once the data were adjusted for a community’s demographic composition, no significant gap in the level of general disruption between rural and urban communities was found. However, financial stability (such as income and job losses) continued to be a major issue in urban areas relative to rural communities, while small rural businesses continued to report greater disruption than small businesses in urban communities.

Differential Impact among Communities of Color Persists

Responses to the 2021 survey indicated that communities of color were more likely to be significantly disrupted than white communities, both within rural areas and within urban areas. This holds true for different segments of the economy: financial stability, services for children, access to health care, housing stability, as well as disruption in basic consumer needs. Not only were communities of color more likely than white communities to report significant disruption, but they also were more likely to be in a worse situation than prior to the pandemic.The Community Impact Survey asked providers this question: “Comparing the current situation to pre-pandemic conditions, how have the following changed for the people and community you serve?” When responses across type of communities served are compared, communities of color were 7% more likely than white communities to report doing worse.

The racial disruption gap could be related to several reasons, such as income loss differences or job differences. Using the Household Pulse Survey, Ana Kent and Lowell Ricketts found that between April and May 2021, 36% of Black families and 34% of Hispanic families reported lost employment income in contrast to 14% of white families. The two authors also suggested that lack of emergency servings could be a contributing factor to the disruption observed.For an analysis of the pandemic’s impact on housing distress and the resulting racial and ethnic disparities, see Lowell Ricketts and Stephen Roll’s 2021 blog post. Last but not least, differences in access to health care and health insurance could also be adding to this gap. An Urban Institute analysis (PDF) showed that between late April and mid-July 2020, more than 3 million adults lost employer-sponsored insurance (ESI), and such losses were concentrated among young adults, adults who did not attend college and Hispanic adults. Though the reduction in ESI was partially offset by a rise in public coverage, groups that faced the largest ESI losses also saw the largest increases in the loss of insurance.

Urban and Rural LMI Communities Experience Similar Levels of Disruptions

U.S. rural and urban areas differ in several ways relevant to the impacts of the COVID-19 pandemic. First, there is a marked difference in age structure, with rural areas being significantly older.

Second, rural areas have lower health outcomes and less access to health care due to fewer physicians, lack of mental health services, higher disability, and more uninsured. These rural health disadvantages may translate into higher rates of rural adults being unable to work due to heightened fear of contracting COVID-19.

However, a 2020 paper by Matthew M. Brooks and others found that rural labor markets have generally fared better during the pandemic than urban labor markets; rural adults were less likely to report being unable to work or unable to look for work due to COVID-19.

Utilizing the most recent CIS data, this blog post found no significant differences in the likelihood of general economic disruption (at the time of the survey in August 2021) between urban and rural LMI communities once the data are controlled for demographic compositions. (See the figure below.) This also held when housing stability, access to health care and services for children were examined.

Significant Economic Disruption Reported in the Community

Significant Economic Disruption Reported in the Community

SOURCES: Community Impact Survey 2021 and author’s calculations.

NOTE: Share of service providers, such as nonprofits, that reported their communities being significantly disrupted; the data are disaggregated by geography and type of community served. The black vertical bars represent the 95% confidence interval for each estimate.

However, consistent with Chalise and Gutkowski’s 2021 blog post, disruptions in financial stability were more likely to occur in urban communities than in rural communities. In addition, relative to pre-pandemic levels, financial stability in urban areas was still significantly worse than that in rural areas at the time the survey was administered. On the other hand, small business in rural communities were more likely to be significantly disrupted than those in urban areas; in addition, small rural businesses were more likely to be in worse conditions than pre-pandemic levels.

The Intersection between Race, Ethnicity and Geography

The previous figure shows that overall, white rural communities seemed less likely to be significantly disrupted than the other three groups (white urban communities, rural communities of color and urban communities of color) in terms of general economic disruption. This is consistent Chalise and Gutkowski’s 2021 blog post, in which lower levels of disruption were reported for rural and white communities.

With respect to financial stability, white rural communities were the least likely to be significantly disrupted. On the other hand, small businesses were more likely to be disrupted in rural communities of color. A report by the Committee on Small Business suggests that historic inequalities such as lack of access to capital, fewer business mentorship relationships, and a general lack of business opportunity have combined with hurdles brought on by the pandemic to further hurt rates of Black-owned business formation and success (PDF).

Nevertheless, this analysis found no further difference in reported disruption levels between urban and rural LMI communities when analyzing other segments of the economy, such as housing stability, services for children, access to health care and access to basic consumption needs. Next week, the second post in this two-part series will show that unequal access to government relief and recovery plans may help explain approximately 30% of the difference in the reported disruption between communities of color and white communities.

Notes

  1. The Community Impact Survey asked providers this question: “Does the entity you represent primarily serve a community of color?” In this blog post, communities that were not reported as being communities of color are described as “primarily white.”
  2. The Community Impact Survey asked providers this question: “Comparing the current situation to pre-pandemic conditions, how have the following changed for the people and community you serve?” When responses across type of communities served are compared, communities of color were 7% more likely than white communities to report doing worse.
  3. For an analysis of the pandemic’s impact on housing distress and the resulting racial and ethnic disparities, see Lowell Ricketts and Stephen Roll’s 2021 blog post.
  4. A report by the Committee on Small Business suggests that historic inequalities such as lack of access to capital, fewer business mentorship relationships, and a general lack of business opportunity have combined with hurdles brought on by the pandemic to further hurt rates of Black-owned business formation and success (PDF).
About the Author
Violeta Gutkowski
Violeta Gutkowski

Violeta Gutkowski is an associate economist at the St. Louis Fed. Read about Violeta’s work.

Violeta Gutkowski
Violeta Gutkowski

Violeta Gutkowski is an associate economist at the St. Louis Fed. Read about Violeta’s work.

This blog offers commentary, analysis and data from our economists and experts. Views expressed are not necessarily those of the St. Louis Fed or Federal Reserve System.


Email Us

Media questions

All other blog-related questions

Back to Top