Key Highlights
- JPMorgan Chase Institute points to smaller cash buffers in Black and LatinX Households
- Spending patterns likely to be disproportionately felt
A just released study by the JPMorgan Chase Institute indicates that LatinX and African American families will likely experience COVID job and income losses more than Caucasian families. Families of color tend to have lower incomes, are more likely to be paid hourly wages and are less likely to hold positions that grant access to paid leave.
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- The median African American family earns $.71 on the take-home dollar income earned by white families
- The median LatinX family earns $.74 on the take-home dollar income earned by white families
- As incomes increase, this gap in wages increase
- In liquid assets (savings and checking accounts, prepaid debit cards, money market and certificates of deposit accounts), the gap is twice as large as the gap in take-home income.
The Institute, while reviewing data on 1.8M checking account holders in Florida, Georgia and Louisiana, found that a decrease of $500/month due to a layoff translated into African American families reducing their monthly spending by approximately $230/month and LatinX families reducing their spending by roughly $215/month. White families reduced their monthly spending by $140/month.
Comparing African American and Caucasian earnings by gender, this Chase Institute study found that African American men earn 66% of what Caucasian men earn and hold only 29% of the liquid assets held by white men. African American women earn 78% of what Caucasian women earn and hold approximately 36% of the liquid assets held by white women.
The JPMorgan Chase Institute suggests that policy makers focus on supporting families with the lowest liquid asset buffers when determining both the increase and expansion of unemployment insurance benefits and the typical $1,200 stimulus checks most Americans will receive from the government to help offset COVIC job and income losses.
Thanks to BloombergNews’ Reade Pickert.
Also read: Independent Contractors May Receive Less in UI Checks Than Anticipated Pending Home Sales Plummet Nearly -21% in March
