Within a month of the announcement that COVID-19 was an official pandemic, the global economy – and America’s in particular – were already on the ropes, awaiting both relief money and a treatment breakthrough that promise to stabilize both human and business health.
The latest edition of PYMNTS’ report series Navigating the COVID-19 Pandemic: How the Paycheck-to-Paycheck Economy Is Beginning to Buckle, drills down on the plight of workers who have been furloughed or laid off in the dramatic downturn, and what recovery looks like.
According to the latest report, “the COVID-19 pandemic has had an unprecedented impact on employment, with the share of U.S. residents who were employed or earning incomes decreasing from 60.8 percent on March 6 to 51.7 percent on March 27. This means the portion of residents earning incomes dropped 15 percent in just over three-and-a-half weeks, which translates to 22.8 million people losing their jobs in less than a month.”
Uncertainty About Jobs, Finances
PYMNTS began tracking COVID-19 trends on March 6, nearly a week prior to the pandemic declaration. A new survey has been fielded roughly every 10 days since, asking 2,000 U.S. consumers how the pandemic is impacting their lives and commercial decisions.
A stark finding in the latest edition is the fact that those still employed as the virus approached its apex are not confident in continuing job prospects. “Consumers are anxious about their financial futures amid the uncertainty surrounding the pandemic and its economic impacts,” the report states. “We found that 48.8 percent of U.S. workers – approximately 77.4 million people – were worried they might lose their jobs, with 28.5 percent saying they were ‘very’ or ‘extremely’ concerned. This meant 45.2 million consumers feared losing their jobs, and 32.2 million were ‘somewhat’ worried about losing them.”
Millions of Americans were already living paycheck-to-paycheck when the new contagion reached U.S. shores, and that situation has predictably worsened with each day’s news. Not surprisingly, these folks express the highest anxiety levels when it comes to job loss.
“Consumers living paycheck to paycheck were also more worried about losing their jobs, with those who struggled to pay their monthly bills being the most worried,” the report states. “Our research showed that 20.8 percent of consumers who lived paycheck to paycheck and struggled with their bills were ‘very’ or ‘extremely’ worried about losing their jobs, compared to the 14.6 percent of paycheck-to-paycheck workers who were comfortably paying their monthly bills.”
Bracing for a Difficult Road
Some believe life will never return to a pre-COVID sense of security, though respondents to this edition of PYMNTS’ series do see a light at the end of the tunnel.
“Consumers’ widespread COVID-19 fears were likely due in part to how long they believed it would affect their everyday lives,” the report states. “The average consumer surveyed on March 27 believed the pandemic’s effects would last another 134 days, compared to the 138 days they expected it to last when surveyed March 17. This means that much of the U.S. workforce is bracing for a long, difficult road ahead as the pandemic continues to spread.”