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Fantastic job as always by @emilymbadger and @aliciap at @nytimes @NYTupshot writing about my new paper with Raj Chetty, @nhendren82 , and @michaelstepner about the COVID-19 crisis (1/N) https://www.nytimes.com/2020/06/17/upshot/coronavirus-spending-rich-poor.html
We use data from the @OppInsights Economic Tracker, where you can see spending, business revenues, employment, job postings, and more in real time, in your state or county. (2/N)
http://www.tracktherecovery.org
New Today:
-spending by household income
-low-income employment
http://www.tracktherecovery.org
New Today:
-spending by household income
-low-income employment
The economic crisis started (unlike most recessions) because especially high-income households pulled back on spending. Even today, high-income households are spending more than $1 billion less than on a typical June day. (3/N)
This drove down small business revenues and employment most sharply in affluent areas, hitting low-income workers in these areas especially sharply.
This variation is present even across ZIPs in many cities, eg here see NYC (4/N)
This variation is present even across ZIPs in many cities, eg here see NYC (4/N)
See the employment patterns here too in Chicago and San Francisco. (4/N)
To explore more ZIP maps see:
https://opportunityinsights.org/zip-maps/
To explore more ZIP maps see:
https://opportunityinsights.org/zip-maps/
Although the economy is recovering, policies are doing very little to help those small businesses and workers most hard hit.
Reopenings did essentially nothing to increase spending or employment (5/N)
Reopenings did essentially nothing to increase spending or employment (5/N)
The stimulus drove enormous and immediate increases in spending for low-income households, literally on the day of the stimulus payments. But it did very little to increase spending among affluent households.
Employment thus remains low. (6/N)
Employment thus remains low. (6/N)
The PPP also seems to have had very little effect on employment, seen here by comparing businesses than are just above or below the eligibility thresholds.
It seems that most of the PPP went to businesses that were already planning to keep their workers on (7/N)
It seems that most of the PPP went to businesses that were already planning to keep their workers on (7/N)
So what are we to do?
The large reduction in spending by high-income households was driven by fear of COVID-19. The only path to full economic recovery is to restore consumer confidence through public health policies. (8/N)
The large reduction in spending by high-income households was driven by fear of COVID-19. The only path to full economic recovery is to restore consumer confidence through public health policies. (8/N)
Until then, we must support the many especially low-income workers and who have lost their income.
UI benefits, and targeted assistance to those in the hardest hit areas, may prevent descent into the cycle of poverty and prevent long-lasting local recessions. (9/9)
UI benefits, and targeted assistance to those in the hardest hit areas, may prevent descent into the cycle of poverty and prevent long-lasting local recessions. (9/9)
