One in three Americans are concerned about how long their jobs will hold out amid an unemployment rate of 10.2% and the lingering impacts of COVID-19, according to a recent survey by WalletHub.
While this is the first time WalletHub surveyed consumers about job security, a report from Workest in May found 53% were worried about job security with half saying their jobs wouldn’t likely last longer than three months without some form of fiscal stimulus. The WalletHub survey found Americans overwhelmingly (74%) believe Congress should continue to give extra unemployment benefits until the pandemic ends.
Economist Mervin Jebaraj said more stimulus is needed, and without it, sentiment took a blow in August. Jebaraj, director of the Center for Business & Economic Research at the University of Arkansas, said it was the stimulus that propped up the economy in June and July.
Sarah House, a senior economist at Wells Fargo Securities, said economic momentum has slowed in July with 1.8 million jobs added, considerably less than 4.8 million jobs added in June. She said unemployment remains high, and in August the U.S. was still 13 million jobs short of where it was prior to the pandemic.
“There is still a long way to go and there is a tremendous need for policy support, both monetary and fiscal with another round of stimulus for businesses and consumers,” House said recently in a video report.
Congress remains in recess and will reconvene in September and many expect a stimulus bill to be ironed out in the coming weeks. House said a failure to reach a deal would have a wide-ranging impact on the economy and likely erase the gains made earlier this summer.
The WalletHub survey also found half of the respondents said they have worked harder since the coronavirus pandemic began. Economic professor Evan Osborne of Wright State University, said there are several reasons why respondents think they are worker harder. He said with more people working from home many are having to find ways to combine work with household responsibilities and help children with virtual classes. He said this has stretched the boundaries families must now maneuver.
Osborne said for the 33% concerned about job security, the best they can do is make themselves indispensable. But he cautioned them to keep work in perspective. He said it’s important to find time to relax and care for those who also need and deserve attention.
“Life is always challenging, but these times particularly so,” Osborne said. “And of course, especially in times like these, try and save more money. Admittedly, that makes the situation of businesses that sell consumer products tougher.”
WalletHub also found 75% of respondents will not travel this Labor Day weekend, with 77% of those saying they do not trust others to be responsible about social distancing. Donald Gardener, business professor emeritus at the University of Colorado, said the decision by many to remain close to home this Labor Day will have a substantial negative effect on revenue for small businesses in popular vacation and tourism locations. He said rafting is now popular in Colorado, but people may avoid being close to others as in a raft. He said small businesses such as restaurants out outdoor movie theaters could see an increase in revenue as people stay close to home.
WalletHub found 40% said they plan to go shopping during Labor Day weekend, but 28% said nothing would make them feel comfortable enough to go shopping. Retailers have said back-to-school sales are sluggish and discretionary sales also began to subside in late July. They do not expect any return until another stimulus is approved and consumers get more cash in their hands.
Another issue for businesses is how the workforce and workplace have changed. The Workest survey found 41% of respondents believe the economy will bounce back once COVID-19 is under control. Also, 6% of respondents had been laid off because of the pandemic and 20% said the businesses they worked for had permanent lay-offs. One in five had been furloughed and one in three had hours reduced. About one in 10 said they took salary cuts and 9% of executives also took pay cuts, according to the Workest survey.