Layoffs by companies are affecting Americans across the country. Victor Ho lost his internship with a leading makeup brand in New York, just two months after getting it. (May 7)
Nearly 20% of American adults lost a job or saw their hours cut in the early days of the coronavirus crisis but the vast majority of those laid off or furloughed said their employer told them to expect to come back, a Federal Reserve survey shows.
Most employers, however, did not give the workers a return date, reflecting the uncertainty of the course of the pandemic, business reopenings and any rebound in customer traffic.
Low-income Americans were hit hardest. Of people working in February, nearly 40% of those with a household income below $40,000 reported a job loss in March.
The results were highlighted in the Fed’s Report on the Economic Well-Being of U.S. Households. The study mostly draws an annual survey of 12,000 adults in October but adds a smaller supplemental survey of 1,000 adults conducted April 3-6, shortly after most states shut down nonessential businesses to contain the spread of the virus.
Thirteen percent of adults – who made up 20% of people employed in February – said they had lost a job or were furloughed in March or early April, the report said. Another 6% had their hours reduced or took unpaid leave.
Nine of 10 people laid off or furloughed said their employer indicated they would return at some point. But 77% said they weren’t told when they would come back.
The finding is consistent with data in the April jobs report that showed nearly 90% of Americans who had lost a job said they were on temporary layoff. The Fed survey, however, sheds further light on employers’ thinking.
Despite the possibility of a sharp rebound in jobs reflected in those numbers, Greg Daco of Oxford Economics is among economists who believe such a strong bounce-back is unlikely. States are reopening their economies gradually. Some businesses have closed permanently. And it’s unclear when consumers will return to malls, restaurants, movie theaters and other businesses in large numbers before a vaccine is available, possibly by early next year.
The Labor Department reported Thursday that another threemillion workers filed initial unemployment claims last week, bringing the eight-week total to a staggering 36.5 million. First-time jobless claims are a reliable gauge of layoffs. The economy shed more than 21 million net jobs — including payroll losses and new hiring — in March and April, with up to 10 million or so more job losses expected in May.
Other findings from the Fed’s April survey:
► Twenty-three percent of all adults, and 70% of those who lost a job or had hours reduced, said their income in March was lower than in February.
► Among those who lost a job or had their hours cut, just 51% said they were doing at least okay financially while 48% said they were “finding it difficult to get by” or “just getting by.” Overall, 72% of adults said they were doing okay financially or living comfortably, down from 75% in October 2019.
► Sixty-four percent of those losing jobs or seeing reduced hours expected to be able to pay all their bills in April, versus 85% with no disruption in their employment.
Read or Share this story: https://www.usatoday.com/story/money/2020/05/14/coronavirus-nine-10-workers-laid-off-furloughed-expected-come-back/5190748002/