55 posts on "Equitable Growth"
February 27, 2023
Does the CRA Increase Household Access to Credit?
Congress passed the Community Reinvestment Act (CRA) in 1977 to encourage banks to meet the needs of borrowers in the areas in which they operate. In particular, the Act is focused on credit access to low- and moderate-income communities that had historically been subject to discriminatory practices like redlining.
Posted at 7:00 am in Banks, Credit, Equitable Growth, Inequality, Regulation | Permalink | Comments (2)
January 18, 2023
Rural Households Hit Hardest by Inflation in 2021‑22
To conclude our series, we present disparities in inflation rates by U.S. census region and rural status between June 2019 and the present. Notably, rural households were hit by inflation the hardest during the 2021-22 inflationary episode. This is intuitive, as rural households rely on transportation, and especially on motor fuel, to a much greater extent than urban households do. More generally, the recent rise in inflation has affected households in the South more than the national average, and households in the Northeast by less than the national average, though this difference has decreased in the last few months. Once again, these changes in inflation patterns can be explained by transportation inflation driving a large extent of price rises during 2021 and much of 2022, with housing and food inflation lately coming to the fore.
Young, Less Educated Faced Higher Inflation in 2021—But Gaps Now Closed
We continue our series on inflation disparities by looking at disparities in inflation rates by educational attainment and age for the period June 2019 to the present. Remarkably, we find that disparities by age and education are considerably larger than those by income and are similar in size to those by race and ethnicity, both explored in our previous post. Specifically, during the inflationary period of 2021-22, younger people and people without a college degree faced the highest inflation, with steadily widening gaps relative to the overall average between early 2021 and June 2022, followed by a rapid narrowing of the gaps and a reversal of some of them by December 2022. This pattern arises primarily from a greater share of the expenditures of younger people and people without a college degree being devoted to transportation—particularly used cars and motor fuel—which led the 2021 inflationary episode but has since converged to general inflation.
Inflation Disparities by Race and Income Narrow
As inflation has risen to forty-year highs, inflation inequality—disparities in the rates of inflation experienced by different demographic and economic groups– has become an increasingly important concern. In this three-part blog series, we revisit our main finding from June—that inflation inequality has increased across racial and ethnic groups—and provide estimates of differential inflation rates across groups based on income, education, age, and geographic location. We also use an updated methodology for computing inflation disparities by focusing on more disaggregated categories of spending, which corroborates our earlier findings and substantiates our conclusion that inflation inequality is a pronounced feature of the current inflationary episode.
October 20, 2022
Long COVID Appears to Have Led to a Surge of the Disabled in the Workplace
Although most of those infected with COVID-19 have recovered relatively quickly, a substantial share has not, and remains symptomatic months or even years later, in what is commonly referred to as long COVID. Data on the incidence of long COVID is scarce, but recent Census Bureau data suggest that sixteen million working age Americans suffer from it. The economic costs of long COVID is estimated to be in the trillions. While many with long COVID have dropped out of the labor force because they can no longer work, many others appear to be working despite having disabilities related to the disease. Indeed, there has been an increase of around 1.7 million disabled persons in the U.S. since the pandemic began, and there are close to one million newly disabled workers. These disabled workers can benefit from workplace accommodations to help them remain productive and stay on the job, particularly as the majority deal with fatigue and brain fog, the hallmarks of long COVID.
Posted at 7:02 am in Equitable Growth, Inequality, Labor Market, Pandemic | Permalink | Comments (2)
How Have Racial and Ethnic Earnings Gaps Changed after COVID‑19?
Racial and ethnic earnings disparities have been salient features of the U.S. economy for decades. Between the pandemic-driven recession in 2020 and the rising inflation since 2021, workers’ real and nominal earnings have seen rapid change. To get a sense of how recent economic conditions have affected earnings disparities, we examine real and nominal weekly earnings trends for Asian, Black, Hispanic, and white workers. We find that average real weekly earnings have been declining in the past year, but less so for Black and Hispanic workers than for white and Asian workers. Black and Hispanic workers have also experienced small increases in real earnings since the pre-pandemic period.
October 4, 2022
Eviction Expectations in the Post‑Pandemic Housing Market
Housing is the single largest element of the typical household’s budget, and data from the SCE Household Spending Survey show that this is especially true for renters. As the housing market heated up in the latter stages of the pandemic, home prices and rents both began to rise sharply. For renters, some protection from these increases was afforded by national, state, and in some cases local eviction moratoria, which greatly reduced the risk of households losing access to stable housing if they couldn’t afford their rent. Yet many of these protections have expired and additional supports will do so soon. In this post, we draw on data from our SCE Housing Survey to explore how renters perceive their housing risk and find that the answers depend to a large degree on their current and past experiences of the housing market.
June 30, 2022
Was the 2021‑22 Rise in Inflation Equitable?
In our previous post, we discussed how the labor market recovery—the “maximum employment” half of the Federal Reserve System’s dual mandate—featured not only a return of overall employment rates to pre-pandemic levels, but also a narrowing of racial and ethnic gaps in employment rates. In this post, we take up the second half of the dual mandate—price stability—and discuss heterogeneity in inflation rates faced by different demographic groups during the rise in inflation in
2021-22. We find that, in contrast to inequalities in employment rates, disparities in inflation rates have widened during the recent inflationary episode, with Black and Hispanic Americans experiencing more inflation.
How Equitable Has the COVID Labor Market Recovery Been?
One of the two monetary policy goals of the Federal Reserve System— one-half of our dual mandate—is to aim for “maximum employment.” However, labor market outcomes are not monolithic, and different demographic and economic groups experience different labor market outcomes. In this post, we analyze heterogeneity in employment rates by race and ethnicity, focusing on the COVID-19 recession of March-April 2020 and its aftermath. We find that the demographic employment gaps temporarily increased during the onset of the pandemic but narrowed back by spring 2022 to close to where they were in 2019. In the second post of this series, we will focus on heterogeneity in inflation rates, the second part of our dual mandate.
May 12, 2022
First‑Time Buyers Were Undeterred by Rapid Home Price Appreciation in 2021
Tight inventories of homes for sale combined with strong demand pushed up national house prices by an eye-popping 19 percent, year over year, in January 2022. This surge in house prices created concerns that first-time buyers would increasingly be priced out of owning a home. However, using our Consumer Credit Panel, which is based on anonymized Equifax credit report data, we find that the share of purchase mortgages going to first-time buyers actually increased slightly from 2020 to 2021.
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