COVID-19: Widening inequalities across the Capital

In this blog post, our economics partner WPI Economics continue their work analysing what the latest data tells us about the impact of COVID-19 in London, finding that the most deprived areas prior to the COVID-19 crisis have seen the largest increases in claims of unemployment benefits.

With the COVID-19 pandemic and its impacts at the front of everyone’s minds, the challenge for the team that produces London’s Poverty Profile (LPP) – a resource which provides evidence on and insight into poverty and inequality – is finding data that can tell an up-to-date story of the situation across London. Since most of the indicators for LPP are based on official datasets, which are often released with a delay of six months or more, we have looked to introduce new analyses that can shed a light on how COVID-19 is impacting on poverty and inequality across the capital.

The first of these explored the link between deprivation and mortality. It demonstrated that, even after accounting for a range of other relevant neighbourhood characteristics, the most deprived 20% of neighbourhoods in London have seen, on average, 23 more COVID-19 deaths per 100,000 than the least deprived 20% of neighbourhoods.

Today we are releasing new analysis, which considers an economic dimension of COVID-19; exploring the link between deprivation and recent rises in unemployment. To do this we have looked at how the proportion of people claiming unemployment benefits has increased over the last year for neighbourhoods across London. We then assess how this relates to the relative level of deprivation in each area.

The results mirror other recent findings at a national scale; showing that the most deprived areas in London prior to the COVID-19 crisis have seen the largest increases in claims of unemployment benefits.

The most deprived 10% of London neighbourhoods have seen their rate of claims for unemployment benefit rise by around 7 percentage points, some 2.5 times that experienced by the least deprived 10% of neighbourhoods (that saw a 2.8 percentage point increase).
Changes in unemployment benefit claim rate graph by deprivation decile in London

We can also see how this looked when mapped across London. The graphic below shows a snapshot of this, and our online interactive map allows you to search and explore that data.

Claimant count change and deprivation map for London
This provides more evidence which suggests that the health, economic and social impacts of COVID-19 could act to widen inequalities across the capital.

It is necessary to understand which communities across London are most affected by the health, social and economic consequences of COVID-19 in order to develop the most appropriate policy responses. Providing this information is at the heart of what we are trying to do with London’s Poverty Profile.

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