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America Has the Most Extreme Income Inequality Among G-7 Peers

Income inequality in the U.S. outranks all other G-7 countries, according to the Pew Research Center

The Gini coefficient, the measurement tool used by the OECD to discern equality, operates on a scale of 0, complete equality, to 1, complete inequality. “Globally, the Gini ranges from lows of about 0.25 in some Eastern European countries to highs of 0.5 to 0.6 in countries in southern Africa,” says Pew. 

In the U.S., the top 20% of earners made more than half of all income in 2018. And alarmingly, Pew says, the highest earners are the only group to have increased their wealth following the Great Recession. 

Income inequality has been the subject of public outcry and countless protests across the world over the past year, in particular. “We’re going to see people in increasing numbers dropping out of our mainstream drive for economic success. [Income inequality is] leading to large, loud political cries for completely upending our capitalist system.” says University of Maryland economist Melissa Kearney.

US Boards Are Not Diversifying Fast Enough

Source: New York Times; Institutional Shareholder Services’ ESG division

Despite a lot of activist pressure, representation of minority ethnic and racial groups on U.S. boards has increased by only 2.5% over the last five years. None of the industries surveyed fill even 20% of their board seats with members of minority groups, according to the Institutional Shareholder Services. 

IT company boards reflect the most diversity — at just 17% — up 3.9 percentage points from 2015, followed by utility companies at 16.5%. Both the energy and real estate industries suffer the lowest levels of diversity, at 9% and 10%, respectively. Many big companies are taking the The Board Challenge — a pledge to add at least one Black director to their boards. But ISS found that Black women represent only 1.5% of more than 20,000 directors analyzed. 

The U.S. is lagging behind other countries in workplace diversity, despite the majority of the American public wanting to see change. “A diverse and inclusive workforce ensures that the innovations created are reflective of the organization’s diverse customer base,” according to Marsh and McLennan Insights. 

US Active Oil Rig Count Collapses From COVID-19

Source: Baker Hughes, North America Rig Count

The U.S. active oil and gas rig count hit a record low of 251 in July due to the economic damage caused by the COVID-19 pandemic — the year started with the rig count at 796. Prior to COVID-19, the lowest rig count was 404 during the oil crash of 2014. 

Texas, the largest oil-producing state in the U.S., lost 336 land rigs this year. Each of these rigs creates an estimated 31 jobs immediately and more than 300 in the long term. 

The pandemic first majorly impacted the oil industry at the beginning of March 2020 when oil prices plummeted. By August, the oil industry had lost more than 100,000 jobs. Although the U.S. administration implemented measures to bail out big oil companies, thousands of workers are still struggling financially. Devashree Saha of The World Resources Institute states that government responses need to prioritize workers and communities to ensure they “are not collateral damage in the pandemic-fed downturn or during the longer-term energy transition.”

COVID-19 Threatens a Decade of Progress Against Poverty for Low-Income Countries

Source: International Monetary Fund

As the percentage of those living in poverty grows, household consumption declines, prompting concern over “the permanent loss of productive capacity,” in low-income developing countries (LIDC) says the IMF. Rising levels of poverty also threaten progress in health, education and gender equality, with implications for lifetime earnings and savings.

LIDCs experienced 5% growth just last year, and they even contributed a larger portion of COVID-19 financial support toward health compared to advanced or emerging economies. But they aren’t able to provide the same level of fiscal support as a public safety net or to stimulate economic activity.   

More vulnerable countries may look to their international community for support, for example, in the provision of health supplies, supply chain protection and financial assistance, including debt payment deferrals. The virus is only the first challenge to overcome, says the IMF, as “the COVID-19 pandemic will be defeated only when it and its socioeconomic consequences are overcome everywhere.” 

Northern Europe Maintains a Positive View of Its Economy, Even Amid the Pandemic

Source: Pew Research Center

Nearly 75% of those in Denmark believe their country’s economic situation is good — a surprising outlook considering the restrictions COVID-19 has placed on economic activity across the world. These views were reported between June and August, 2020, and collected in a survey from the Pew Research Center.

A similar percentage of respondents from Sweden and the Netherlands share positive views about their countries’ economies. But these northern European countries are outliers, as most adults surveyed across 14 countries report a negative economic situation in their country.

Denmark and Sweden — the two countries with the highest percentage of positive assessments of their respective economies — have had relatively low COVID-19 infection and death rates. They were also two of the first countries in Europe to lift lockdown restrictions. There is a correlation between how respondents perceive their country’s response to COVID-19 and how they view the economic status of their country, according to the research: “Those who view their country’s coronavirus response negatively are more likely to describe their country’s current economic situation as bad.” 

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