The long-term effects of the COVID-19 pandemic will intensify the existing divide in life opportunities between the rich and the poor in the United States who, among the world’s most developed nations, provides the least economic mobility for its citizens.

After the pandemic, restoring the American Dream may take a while. But for too many, that dream never existed. While the over-65s have accounted for 80% of COVID-related deaths in the US, it is the under-25s who will live with the pandemic’s long-term social and economic reverberations. This, coupled with existing inequalities and lack of social mobility, currently offers a bleak outlook.

Looking through a post-COVID lens can feel somber but we must be optimistic and plan how we can make positive structural changes in the aftermath of the pandemic before we risk losing a generation.

How did existing inequalities worsen the spread of COVID-19?

Before we can look forward, we need to explore social mobility in the United States before and during the coronavirus. The health crisis has generated significant concern about the future of social mobility in the United States because it has widened both economic and educational inequality. In truth, these existing inequalities only made the virus deadlier.

When COVID-19 broke, there were two critical factors linked to its spread: old age and having a pre-existing health condition. Soon, a third was added:  low economic status. Nicole A. Errett, a public health expert at the University of Washington commented, “pre-existing social vulnerabilities only get worse following a disaster, and this [COVID-19] is a perfect example of that.”

The Congressional Budget Office reported 28.9 million uninsured Americans in 2018, estimating the number to increase to 35 million by 2029.  Preventive care and health education have steadily tilted towards the educated and the well-off, rendering those with less income 10% more likely to have a chronic health condition. As Chinese research shows, this made COVID-19 10 times more deadly in certain corners of society.

In 2019, a survey by kff.org reported one in four Americans saying someone in their family had skipped a doctor-recommended test because they couldn’t afford it. And it was healthcare economics in lower income corners of society, coupled with increased part-time employment, that led to three in ten workers continuing to show up to work – with symptoms – during the 2009 swine flu pandemic. Research concludes that people working with symptoms – because they couldn’t afford to miss work – accounted for 27% of all swine flu infections in the US.

Wealth remains an indicator of social well-being and in the US, economic inequality is closely linked to racial divides in income and wealth. Wealthier families are better positioned to afford education, live in better neighborhoods, leave a bequest and withstand financial hardships during emergencies – like a pandemic. Approximately 21% of black people and Latinos in the US live under the poverty line compared to 8% of white people and the median white household has 41 times more wealth.

Due to long-standing segregation by income, race and social mobility, the impact of COVID-19 will likely make these divides wider, meaning minorities suffer disproportionately during a pandemic and disproportionately after it.

The Land of Opportunity Gap

2019’s Social Mobility Index shows social mobility in the US becoming more and more constrained; the gap between the rich and the poor as large as it was in Europe during the Belle Epoque, an era of extreme financial inequality that collapsed under two world wars.

And consider this: income inequality in America is the highest it’s been since the Census Bureau started tracking it. The country currently has a Gini coefficient (where 0 equals complete equality and 1 equals total inequality) of 0.485 – greater than any European country. For context, South Africa, one of the most unequal countries in the world, sits at 0.625.

To avoid an even further decline in social mobility, issues like economic and educational divides must be challenged to make the country’s workforce – and therefore the classroom – look a lot different.

Where you grow up really matters

In 2013, Raj Chetty, a professor of economics at Harvard illustrated his paper ‘Where is the land of opportunity?’ with a heat map of intergenerational mobility in the United States. The map is based on the income records of 40 million children and their parents and highlights the huge disparities in social mobility across the United States. For example, a black boy born to a wealthy family is more than twice as likely to end up poor as a white boy from a wealthy family.

Chetty presents how geography and wealth affect opportunity: if you grow up in Charlotte, NC, to parents in the bottom fifth of income distribution, the odds of reaching the top fifth are just 4.4%. However, if you grow up in San Jose, CA, the odds are tripled.

The data shows that moving a child to a lower poverty neighborhood significantly improves their college attendance rates and earnings in adulthood. The map also exposes the nation’s elite colleges admitting more young people from the wealthy 1% than from families in the bottom 60%.

Chetty’s map cast major doubt on the American Dream: upward social mobility rates have been in decline since 1940.

The elusive American Dream

During COVID-19, education has often been beyond the reach of students from families with fewer resources – and the quality of education available has been limited due to social issues like digital divides.

Many young people from Black, Latinx and Indigenous backgrounds have not been able to access basic tools to further their education during the outbreak and many students from poorer areas now won’t be able to access college education because their family’s income has been eradicated during the pandemic.

The challenge here is the American Dream is structured around graduating. Getting first-gen students to graduate college was the solution to levelling out the nation’s ballooning income and wealth gaps. Over the last decade, a bachelor’s degree has been key to lifting students from low-income backgrounds to middle-income levels – but this progress now sits in the balance.

Average scoring students from high-income families usually end up in college as their parents can pay the tuition fees – and there are plenty of universities willing to admit those who can pay. Average and high scoring low-income students relying on philanthropy and college advisors before COVID-19 may be leaving their college dreams behind as they lose touch with those support systems.

In May 2020, the California State University system – which attracts many first-gen students – announced it was going online in the fall. For students who needed to commute into class because of a lack of digital tools, there’s no current solution.

We need social mobility more than ever

The serious fear now is COVID-19 plunging young people into a dark age of declining social mobility. Helping to level economic inequalities means three things:

• Creating decent jobs so today’s generation can fare better than past generations
• Ensuring that a person’s background does not determine their chances of climbing or falling down the social ladder
• In terms of education and recruitment, ensuring potential is achieved regardless of family income

If Chetty’s study of intergenerational mobility tells us anything, failure to make major changes will create greater problems for the future. Large pools of applicants are already ignored for simply thousands of jobs. LinkedIn and other large talent sourcing platforms receive approx. 250 applicants per open role. This has limited recruiters to reviewing 10% to 20% of applications – they believe – show promise:

• Those coming from Ivy League campuses
• Candidates looking to switch from a competitor
• Candidates applying via employee referral programs

Before applications are received, employers allocate jobs based on alma mater, skewing opportunities toward (and against) students from particular campuses. This leaves most students from non-listed education centers out of the game.

Diversity matters

Upward social mobility for low-income and minority citizens has a wider positive effect. McKinsey reports that companies with racially and culturally diverse teams are 33% more likely to achieve above-average profitability than companies with teams made up of people with the same background. But there’s a long way to go towards achieving workplace diversity:

• Hispanics and Latinos comprise 8% of all US graduates but hold only 4% of senior executive positions (Glassdoor).
• The hiring for black Americans in executive positions is even lower: 10% of US graduates are black and comprise only 4% of senior executives (Glassdoor).
• For the last 30 years, white applicants have – on average – received 36% more callbacks than black applicants with identical resumes (Harvard Business Review).

Let’s drive positive structural change

Post COVID-19, the big challenge will be ensuring people from vulnerable corners of society are not left behind. The opportunity crisis needs to be confronted in order to promote social mobility across the United States. To aid those already the furthest away in a playing field of opportunity, now is the time to help them up the ladder.