Do Racial and Ethnic Disparities in Savings and Job Loss during COVID-19 Explain Disparities in Housing Hardships? A Moderated Mediation Analysis

• Author: Yung Chun,Michal Grinstein-Weiss,Jason Jabbari,Stephen Roll
• Published date: 01 November 2021
• DOI: 10.1177/00027162211069430
• Date: 01 November 2021

68 ANNALS, AAPSS, 698, November 2021

DOI: 10.1177/00027162211069430

Do Racial and

Ethnic

Disparities in

Savings and Job

Loss during

COVID-19

Explain

Disparities in

Housing

Hardships?

A Moderated

Mediation

Analysis

By

MICHAL GRINSTEIN-WEISS,

YUNG CHUN,

STEPHEN ROLL,

and

JASON JABBARI

1069430ANN The Annals Of The American AcademyCOVID-19 and Disparities in Housing Hardships

research-article2021

Despite the array of public programs offered to help

households mitigate the economic impacts of the

COVID-19 pandemic, many still needed to rely on sav-

ings, credit, or other assets to make ends meet. This

reality may exacerbate existing social and economic

inequities because racial and ethnic minorities often

have lower access to assets and credit than white

households. We use longitudinal national survey data to

explore the extent to which different racial and ethnic

groups experienced housing hardships during the pan-

demic, the role of liquid assets in mediating housing

hardship, and whether job/income loss moderated the

relationship among race/ethnicity, liquid assets, and

housing hardship. We find that liquid assets signifi-

cantly mediated the relationship between race/ethnic-

ity and housing hardships and that the effect was

stronger for those who lost jobs or incomes as a result

of COVID-19.

Keywords: COVID-19; savings; employment; housing

hardships; race; ethnicity

The COVID-19 pandemic posed twin risks

for economically marginalized Black and

Hispanic households. The first and most direct

risks concerned the health and physical well-

being of people in those households. In

November 2020, as the pandemic was approach-

ing its peak, non-Hispanic Black individuals

Michal Grinstein-Weiss is the director of the Social

Policy Institute at Washington University in St. Louis

and Shanti K. Khinduka Distinguished Professor. Her

research focuses on the design of innovative policies to

promote household financial security and social and

economic mobility, both in the United States and inter-

nationally.

Yung Chun is a senior analyst at the Social Policy

Institute and the Brown School at Washington

University in St. Louis. With backgrounds in architec-

ture engineering, urban planning, and public policy, he

uses econometric modeling and advanced geospatial

techniques to understand housing markets, finance, and

public policy.

Correspondence: michalgw@wustl.edu

COVID-19 AND DISPARITIES IN HOUSING HARDSHIPS 69

were 1.4 times as likely to be infected with COVID-19, 3.7 times as likely to be

hospitalized due to complications related to the disease, and 2.8 times as likely to

die from the disease compared to non-Hispanic white individuals (Centers for

Disease Control and Prevention 2021). Similar disparities existed in the COVID-

19-related health impacts on Hispanic and non-Hispanic white individuals.

Even as racial and ethnic minority households were more likely to suffer the

direct health effects of COVID-19, they also faced greater economic risks during

the pandemic. The unemployment rates for Black and Hispanic individuals,

already higher than those of white individuals prior to the pandemic, skyrocketed

during the pandemic. By the April 2020 peak in the unemployment rate, roughly

19 percent of Hispanic individuals and 16 percent of Black individuals were

unemployed, while white individuals experienced an unemployment rate of 13

percent (Sáenz and Sparks 2020). Though unemployment rates have declined for

each of these groups, the decline was less pronounced among Black and Hispanic

individuals compared to whites.

The disparities in the economic impacts of the pandemic have led to dispari-

ties in a wide variety of hardships, including food insecurity (Hardy and Logan

2020; Schanzenbach and Pitts 2020), the rate of skipping essential bill payments

(Despard et al. 2020), and eviction/foreclosure rates (Grinstein-Weiss et al.

2020), yet the pandemic did not cause these disparities. Rather, it only exacer-

bated preexisting inequalities in income and access to quality health care

(Smedley, Stith, and Nelson 2003), housing insecurity (Desmond and Gershenson

2017; Medina etal. 2020), wealth (Ren 2020), and other social determinants of

health (Haynes, Cooper, and Albert 2020).

Although they faced a worse economic situation prior to the pandemic and

were disproportionately impacted by pandemic-related unemployment, racial

and ethnic minority households were also likely less able to buffer themselves

against the direct economic impacts of the pandemic due to lower levels of pre-

pandemic emergency savings (Board of Governors of the Federal Reserve

System 2017). These savings, which typically comprise liquid assets held in

checking accounts, savings accounts, or cash (Bhargava and Lown 2006), are

essential in helping households to maintain their consumption needs in the event

of income shocks like job loss or expense shocks like medical emergencies—

experiences that became more likely during the COVID-19 pandemic. Severe

disparities in access to these assets for racial and ethnic minorities prior to the

pandemic may have therefore exacerbated the economic hardships these groups

experienced during the pandemic.

Stephen Roll is an assistant professor of research at the Social Policy Institute and the Brown

School at Washington University in St. Louis. His research centers on consumer financial pro-

grams and policies, specifically the ways in which nonprofit and public programs impact

financial outcomes for lower-income or financially distressed households.

Jason Jabbari is an assistant professor of research at the Social Policy Institute and the Brown

School at Washington University in St. Louis. He uses advanced statistical techniques to under-

stand how policies, programs, and practices can be used to reduce social inequalities, especially

as they relate to children and youth.