The State of the American Worker: Financial Impact of COVID-19
We’ve looked at the pandemic’s impact on employment, and we’ve uncovered the gender divide of COVID-19. But what are things looking like in the realm of personal finances during this time? Our new American Worker Study, produced along with InnovateMR and Women in Research, uncovered how people are feeling in the face of job loss, uncertain futures, and inconsistent CARES act payments.
On the Job Front
Our study shows that companies have both been laying off and hiring during COVID-19. One fifth of managers surveyed for this research reported that their company had laid off or furloughed employees, and almost all (89%) of those who did lay off or furlough during the pandemic, plan to rehire some of those employees after COVID-19 is considered over. In contrast, we found that companies are also hiring in these challenging times, with 31% of managers reporting plans to hire more staff in the next three months.
As also detailed in our latest Future of Money ebook, we found that while 75% of Americans have not lost their jobs, 16% have been furloughed and 9% have been laid off due to the pandemic.
Impact of Stimulus Efforts in the U.S.
Every country has dealt with the economic impact of the pandemic on their local economies and workers in a different way. In the United States, the CARES Act was created to “speed relief across the American economy.” Three in ten Americans did not receive a CARES Act stimulus check or other type of CARES benefit. Although almost three-quarters (72%) of those who make under $75,000 a year received a CARES Act stimulus check, with benefits about to expire, this population is highly vulnerable. Americans who are struggling financially face great uncertainty about the future.
Income Level and Outlook for the Future
Our study showed that lower-income workers (<$75K in household income) are more impacted by the economic and employment effects of the pandemic and report less confidence in the future, with only 13% feeling very optimistic about their personal finances. American workers whose household income is less than $75,000 per year have been laid off or furloughed to a greater degree than those who have household income levels above $75,000.
Key questions to consider
- What kind of help can brands offer customers to manage their finances at this time?
- How can brands continue to communicate and deliver in an empathetic way that is relevant to their markets?
- How can you evolve your communications and products rapidly to meet these changing needs?
There is no doubt that the impact of COVID-19 on our personal finances and the economy as a whole has been significant. To learn more, you can see Logica’s latest Future of Money study.
Related: The Gender Divide of COVID-19