Stephanie Ruiz
Stephanie Ruiz's entire family has been laid off during the coronavirus pandemic.
Stephanie Ruiz

  • Coronavirus lockdowns across America have fuelled record unemployment and deep economic uncertainty in that country.
  • Other countries have already seen civil unrest, and experts say crime, protests, and social upheaval known to South Africans could be a real threat in the USA.
  • "The worse it is, the more likely that people are going to get to the point where social action is the only move forward," Karen Kendrick, a sociologist, said.
  • Visit Business Insider SA's homepage for more stories.

Stephanie Ruiz was working four days a week as a waitress at a taquería in Detroit in the USA making $8 (R150) an hour before tips. On weekends, the 21-year-old often moonlighted as a freelance baby photographer.

But the restaurant closed on March 9 and clients stopped calling her for photoshoots soon after.

Everyone in her family is now unemployed. Her father lost his construction job in mid-March. Her younger sister lost her job as a waitress. Now Ruiz, her parents, and her four younger siblings are all surviving on her father's unemployment checks.

"I was expecting to go to work on Tuesday, and the owners messaged me saying that we wouldn't be opening anymore because of the virus," Ruiz told Insider. "Now they are going to open during the weekend for takeout, but the two owners are going to run it themselves. None of the employees were called back."

She's thankful that she still lives with her parents, but says the loss of income has been devastating.

"People don't really care if others are struggling due to not working," Ruiz said.

Poverty in the US could reach a point 'where social action is the only move forward'

About 22 million Americans filed for unemployment over the past four weeks, a number expected to grow as the coronavirus and subsequent lockdowns ravage the economy. The unemployment rate is nearing 18%, according to Fortune, the highest rate of real unemployment since the Great Depression.

JP Morgan Chase has estimated it will hit 20% before the end of June.

(South Africa has a formal unemployment rate of 29.1%.)

In other countries where the coronavirus has devastated the economy and job market, there's been civil unrest. Police in Italy patrol supermarkets to stop people from stealing food. Millions in São Paulo and Rio de Janeiro banged pots and pans from their windows to protest Brazilian President Jair Bolsonaro.

In Mumbai, thousands of jobless day labourers demonstrated at a railway station Tuesday after Prime Minister Narendra Modi extended the national lockdown.

Poverty, hunger, crime, and social upheaval are a real threat in the US, too, Karen Kendrick, a professor of sociology at Albertus Magnus College in Connecticut, told Insider. Especially if the government doesn't step in to soften the blow.

"There's no doubt this is going to have huge economic and social impacts, and the worse it is, the more likely that people are going to get to the point where social action is the only move forward," Kendrick said.

Demonstrations, such as the ones against Michigan Gov. Gretchen Whitmer and other leaders who have issued lockdown orders, could become more widespread.

Hoarding is already taking place in the US. As people stockpile canned goods, cleaning supplies, and toilet paper, it could put more pressure on supply chains and keep supermarket shelves empty. (Smaller grocery stores and farmer's markets in Los Angeles are already reporting food shortages.)

Crime, at record lows for years, could begin to spike: High-end retailers - from Louis Vuitton in Soho to West Elm in Beverly Hills - have boarded up their storefronts to ward off looters. The NYPD has seen a 75% increase in burglaries of businesses, The Wall Street Journal reported.

"Ever since we started, after World War II, to build up a big middle class, we created a strong base that was economically secure enough that they weren't willing to risk much," Kendrick said. "This pandemic is highly likely to disrupt that. At that point, I don't see how we can avoid social unrest."

On Wednesday, the International Monetary Fund released a report warning that the coronavirus could spark turmoil in countries around the world if people were left without jobs or money for food during and after the pandemic. "If the crisis is badly managed and [the response] is viewed as having been insufficient to help people, you could end up with social unrest," IMF chief economist Gita Gopinath told Reuters.

What other countries are doing, and what the US isn't

That scenario is looking increasingly likely in the US, Johns Hopkins University sociologist Alexandre White said, because the country is taking fewer steps than most European nations to bolster employment.

"There are measures that countries like Iceland and even Britain have taken to ameliorate the personal financial effects of this pandemic … that would go a long way to allow people to effectively manage this crisis at this moment," White said.

James Conway, a 63-year-old server at a Pittsburgh Olive Garden, began filing for unemployment in mid-March, when the restaurant announced it was closing indefinitely because of the pandemic.

Conway had been working four days a week without paid sick days or health insurance, making $2.83 (R53) an hour before tips - the same amount he made when he first started 16 years ago.

Those tips were the only thing allowing him to support himself and his wife, who is retired.

"I am worried about my next paycheck," Conway told Insider.

"The management did not tell me when I may have a job again. They announced that full-time workers will get up to five paid sick days. But since I am a part-time worker, I would only be eligible for 15 hours, or about two days."

The coronavirus is exacerbating social inequalities in America

From US prisons to many low-income neighbourhoods, where people are crammed into close quarters, the virus is more likely to spread. White says social distancing, or even buying gloves and masks, is becoming more difficult for people running out of money.

"Only with a significant amount of funds are you able to purchase food for a week or two at a time," White said. "As financial instability sets in, the strategies for maintaining food security that are also in line with public-health strategies are a real challenge."

And it's often the poorest who can't stay home or work remotely, according to data from the US Bureau of Labor Statistics, Bloomberg reported.

In Detroit, Ruiz says many of her friends are going to work despite the health risk.

"A lot of people I know are essential workers," she said. So they "worry more about going to work than not going to work. People are scared of getting sick."

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