And in terms of wealth, both young and middle-aged adults were already facing high levels of student loans and rising rent costs, even as headlines blared about a rising stock market. This has been particularly true for Virginians from families who weren’t able to help with college costs or making a down payment on a first home. Many of those who were already boxed out before the pandemic are families of color who, because of past and ongoing barriers to wealth-building, are less likely to receive an inheritance or other large monetary transfers from older family members.
Opportunities for recovery
Policymakers at all levels of government have the opportunity to learn from the lessons of the Great Recession and invest in a robust, equitable recovery.
For state policymakers, the federal American Rescue Plan Act provides a historic opportunity to make investments in communities and families who have been shut out for too long. With $3.77 billion in flexible funding for the state of Virginia and another $222 million for capital projects (additional funds will go directly to localities), policymakers can help build a full-employment economy and invest in rectifying past wrongs through investing in labor-intensive, one-time initiatives and seeding wealth-building initiatives for families of color.
To build a full employment economy, the state could make transformative investments in building safe, energy-efficient schools for the current and future generations of children, increased K-12 funding for reading tutors through the Virginia Reading Corps to help children make up for lost instructional time, grants to nonprofit organizations to better help low-income families make home improvements to reduce energy bills, and support for local governments to help young people enter the labor force through summer jobs programs. State policymakers could require that jobs funded through these grants pay wages above a certain threshold (perhaps 150% of the Virginia minimum wage). Alone, these sorts of policies won’t solve every problem, but they would create meaningful improvements in our communities, help address climate change, and provide a decent wage and experience to people who have been shut out of the labor market.