COVID-19 is more likely to harm elderly adults. They are also more vulnerable to the economic downturn brought on by the pandemic.
In an April data brief, the National Council on Aging (NCOA) studied wealth and income data on adults above the age of 60 throughout the Great Recession. The brief found significant correlations between levels of wealth and the severity with which the economic downturn impacted older adults, and it’s likely these traits will again characterize our most vulnerable people as we sink into the coronavirus economic depression.
Here are the highlights:
- The Great Recession most heavily impacted those with the lowest value of non-household financial assets and total household wealth. These impacts dissipate significantly for older Americans outside of the bottom quintile (bottom 20%) when stratified by net wealth.
- Although individuals who are retired generally tend to be worse off due to inflexible incomes (i.e. social security, pensions, etc.), they fare better on measures of overall financial resources and net wealth.
- Those who continued to work, on the other hand, lost value in their financial assets and total household wealth, implying that their choice to work was likely based on the lack of resources needed to support themselves in retirement.
- Overall, older adults (age 75+), especially those who are retired, fare better than those age 60-75 on measures of wealth throughout the Recession.
What NCOA and the data brief disclose are not novel – the characteristic that identifies older Americans most vulnerable to economic downturns is net wealth. In other words, older individuals with the least financial resources are most likely to be impacted significantly by the coronavirus pandemic.
However, the pandemic presents a danger to older adults that is twofold, threatening their health and economic security. Not only does needing to work put already at risk older adults in greater danger of losing their lives, the data tell a distressing story about the ability of those individuals with the least value in household and financial assets to support themselves in the face of unemployment. Accordingly, and especially during Older Americans Month, policy and community responses should focus on cushioning the working elderly that possess little to no assets in order to protect them and their financial wellbeing in the face of the ongoing health and economic crises.
Maxim Applegate is a communications intern with NCRC.