CalMatters
February 24, 2022

Recessions in California tend to widen the gap between rich and poor. The sharp pandemic downturn of 2020 followed this pattern with low-income workers suffering the most. But unprecedented government relief kept millions from falling into poverty, and demand for labor boosted wages when businesses reopened.

Now with federal and state stimulus payments gone, and the recovery still underway, researchers are combing through employment statistics, as well as large-scale survey data, asking whether the pandemic resulted in a deepening of California’s divide. Three out of the last four recessions — excluding the bursting of the internet stock bubble — increased income inequality in California, the Public Policy Institute of California said.

In coming months the institute expects to have its own inequality measure updated with 2020 data. Many Californians already see economic inequality as a facet of life here, with 69% of residents believing the gap between the haves and have-nots is widening, a November poll by the PPIC found.

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