Weathering the Economic Storm of Covid-19

Both the US and the UK experienced dramatic slowdowns in economic activity in response to the COVID-19 pandemic. Each enacted large-scale responses targeted at workers, and in addition, the US extended direct cash aid broadly through economic impact payments (EIPs) and then to most parents with an expanded child tax credit (CTC). UK policies generally kept workers more connected to the workforce and their employer, expediting returns to work. US policies relied on workers disconnecting from the labor force in many cases, which subsequently disrupted health insurance for many. Conditioning aid on employment left some households exposed to broad economic harms of the pandemic unrelated to job loss. US policies that allowed for support without regard to employment status had a powerful effect on reducing child poverty and supporting populations, such as the elderly and disabled, who were both at elevated risk for sickness and death from the COVID-19 virus.