COVID-19 has had a significant impact on the lives and livelihoods of millions of Americans, resulting in higher unemployment than the Great Recession. Many of these workers have lost not only the financial security of a paycheck, but also the health benefits that often accompany a full-time job. Therefore, it is no surprise that the pandemic has led to a resurgence of conversations around fair wages, benefits, and what constitutes a “good job.”
In this three-part series, the Financial Health Network uses Gallup’s Great Jobs survey methodology and May 2020 survey data from the U.S. Financial Health Pulse® to explore:
- Why good jobs matter for financial health and how workers have fared financially during COVID-19
- Which job characteristics are most highly associated with financial health and how they’re rated by low-income workers
- How employers can invest in worker financial health
What Defines Job Quality?
- Level of pay
- Stable and predictable pay
- Stable and predictable hours
- Control over hours and/or location
- Job security
- Employee benefits
- Career advancement opportunities
- Enjoying your day-to-day work
- Having a sense of purpose and dignity in your work
- Having the power to change things about your job that you’re not satisfied with
We replicated Gallup’s methodology for determining job quality for the workers in the May 2020 Pulse survey sample with ratings of good, mediocre, or bad.
Job Quality Matters for Financial Health
Our analysis shows that there is a strong relationship between job quality and workers’ financial health, with 54% of Financially Healthy workers in good jobs, compared with only 10% in bad jobs. This association holds true even when controlling for income, age, education, gender, race, region, and children in the household. This is in line with Gallup’s research demonstrating the significant impact of job quality on worker well-being (read more about those results here).
Workers in bad jobs face higher rates of financial hardship compared with those in good jobs. More than half (51%) reported high or moderate stress because of their finances, compared with 28% in good jobs. Additionally, 23% of workers in bad jobs report they had trouble paying their rent or mortgage in the last 12 months, compared with just 5% of those in good jobs.
Those in bad jobs also have more difficulties accessing healthcare because of the cost. One in five respondents (21%) in bad jobs reported that, in the past 12 months, they or someone in their household did not get the healthcare they needed because they could not afford it, compared with just 4% of those in good jobs. This difference is likely due to the lack of access to healthcare benefits for those in bad jobs, a topic we will dig into deeper in the next part of the series. Regardless of the reason, these are troubling statistics that show how vulnerable workers in bad jobs are to financial shocks like those caused by COVID-19.
The relationship between low job quality and poor financial health is particularly acute for workers of color. For example, 27% of Latinx respondents in bad jobs say they’ve had trouble paying rent in the past 12 months, compared with 18% of similarly situated White respondents. (We were unable to compare Black respondents in bad jobs with other demographic groups because of insufficient sample size.) We also found a gap in healthcare access, with 31% of Latinx respondents in bad jobs saying that they or someone in their household did not get the healthcare they needed because they could not afford it, compared with 18% of White respondents in similar jobs.
Workers in Bad Jobs Fared Worse During COVID-19
Those in bad jobs have borne the brunt of the COVID-19 economic crisis. They are twice as likely to have lost income because of COVID-19 (40%) than those in good jobs (21%). Following the likelihood of a decrease in income, people in bad jobs were also less confident in being able to pay rent, mortgage, or utility bills (47%) and to afford basic necessities (36%) compared with those in good jobs (18% and 13%, respectively).
Latinx respondents in bad jobs also reported higher levels of COVID-related stress compared with similarly situated White respondents, once again highlighting disparities by race and ethnicity. Our research shows that 60%of Latinx respondents in bad jobs reported being worried about their ability to pay rent and basic necessities during the pandemic, compared with 43% of White respondents in similar jobs.
Employers Should Invest in Job Quality
These stark results highlight the need for employers who care about financial health to invest in improving job quality. Workers in good jobs are able not only to fare better in daily life, but also to remain more resilient in the face of unprecedented crises like COVID-19. Additionally, employers have the opportunity to use investment in job quality as a way to improve financial health equity among workers, given the acute challenges workers of color face.
Watch for the second part of our “Good Jobs Matter” series, where we’ll explore the job quality characteristics most highly associated with financial health and how low-income workers rate these qualities.
The Financial Health Network, in partnership with Target Foundation, is conducting research to improve the financial security of workers and expand economic opportunities for all.
