As the coronavirus crisis enters its third month, few have been spared from the economic impact of the deadly disease. Yet some people – low-income households, young people, women, and black and LatinX Americans – are struggling more than others. We leverage new data from the 2020 U.S. Financial Health Pulse, a nationally representative online survey fielded from April 20 to May 7, to show how people are struggling to survive amid the economic fallout from the coronavirus pandemic.
A third (33%) of Americans have lost income because of COVID-19, with financially vulnerable populations most affected.
- 47% of people ages 18-25 say their income has decreased (compared with 37% of people ages 26-49)
- 40% of LatinX respondents say their income has decreased (compared with 32% of black respondents and 31% of white respondents)
- 36% of women say their income has decreased (compared with 29% of men)
- 35% of people with annual household incomes of less than $30,000 say their income has decreased (compared with 30% of people making more than $100,000 a year)
People cite multiple reasons for a decrease in income:
- 44% of people with less income say their employer has reduced their hours or pay
- 42% of people with less income say there is lower demand for their services
- 34% of people with less income were furloughed or put on temporary leave
- 28% of people with less income say they were laid off from a job
Americans are using multiple strategies to survive with less income, with vulnerable populations more likely to spend down savings and look for new work.
Among those who have lost income:
- 79% have cut back on expenses
- 41% have carried a balance on a credit card
- 37% have applied for unemployment insurance
- 34% have spent down their savings
– Black Americans (48%) and people making less than $60,000 (36%) are the most likely to have spent down their savings
- 25% have applied for a new job
–18- to 25-year-olds (40%), black Americans (36%), and people making less than $30,000 (32%) are more likely to have applied for a new job
- 16% have sold something
- 14% have borrowed money from friends and family
- 12% have applied for government benefits (SNAP, WIC, etc.)
- 6% have applied for a loan from a financial institution or online lender
- 5% have borrowed money from their retirement account
- 3% have borrowed using a payday loan, deposit advance, or pawn shop loan
Stimulus payments are helping, but those most in need are getting them later.
- Only 37% of people earning less than $30,000 had received their stimulus payment as of May 7, compared with more than 59% of people with household income greater than $30,000
- Black respondents were 17% less likely to have received their money than white respondents
- More than two-thirds of respondents earning less than $30,000 said they used their stimulus payment to pay for basic necessities, such as food or medicine, or to pay bills, like rent or utilities
While a minority of Americans are bearing the brunt of the crisis, a majority (58%) report some degree of financial stress because of COVID-19.
The Financial Health Network is committed to providing unique insights and disaggregated data to inform the design of smart policies and solutions that can help people weather the ongoing COVID-19 crisis. For example, we will publish a brief in June that explores the impact of job loss on financial health in America. Please visit our Covid-19 Resources Hub for the latest data, insights, and analytics.
