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Post-pandemic inequality will endure in Latin America

Tuesday, February 8, 2022

The pandemic has undone much recent progress in poverty and inequality figures, possibly for some time to come

Infographic exploring the effects of COVID-19 on Latin America. While vaccination rates are rising, extreme poverty levels have risen to a thirty year high, with wide differences in social spending across the region.

Source: UN Economic Commission for Latin America and the Caribbean (ECLAC); Our World in Data

Outlook

Despite rising vaccination rates, Latin America accounted for nearly 29% of global COVID-19 deaths by end-2021.

COVID-19’s effects have also been far wider: according to ECLAC, poverty fell marginally in 2021, but at 201 million people under the poverty line across the region it remained above 2019 rates. Extreme poverty rose from 81 million people in 2020 to 86 million in 2021 -- a level not seen in over 30 years. Emergency welfare spending fell from USD89.7bn in 2020 to USD45.3bn last year; the continuing decline will have knock-on effects.

Across the region the highest poverty levels were among those aged 0-14 years, implying long-term economic and social consequences.

Impacts

  • The lengthy interruption of in-person teaching will deepen inequality long-term.
  • Women’s workforce participation may face long-term obstacles given the impact on education, care and the informal sector.
  • The current wave of Omicron-driven cases could see a drop in expected growth this year even as welfare spending dries up.
  • The Gini coefficient will deteriorate further -- notably in Brazil, where emergency aid generated a slight improvement in 2020.

See also