Nearly half of UK workers expect to struggle to pay bills in the coming months as the economic shock of COVID-19 takes its toll, according to new research by economists at the University of Oxford.
The findings reveal that younger and lower-income workers have been disproportionately affected by the ‘grinding halt’ inflicted on the economy by coronavirus in recent weeks.
Data gathered in the first week of the UK lockdown show that 57% of workers had undertaken less paid work than usual, and that over a third expect to earn less as a result over the next four months.
Some 8% of workers in employment a month ago have already lost their job due to COVID-19. For those still in work, the expected probability of job loss within the next four months is 33%.
Professor Abi Adams-Prassl from the Oxford Department of Economics, who co-authored the study, said: ‘These early findings suggest that even with the unprecedented policy response from the government, many UK workers are already feeling the effects of the economic slowdown and expect significant economic hardship as a result of containment measures.”
The researchers warn that the uneven impact of economic disruption across the working population – disproportionately affecting younger and lower income workers – threatens to worsen existing economic inequalities.
Those on lower incomes were shown to be less able to work from home, while younger, self-employed, or variable-hour contract workers were more likely to have lost their job due to COVID-19.
Professor Adams-Prassl added: “These findings underline the urgent need to speed-up the implementation of stimulus and social assistance packages to provide quick assistance to help those hit hardest.”
The paper forms the first wave of a collaborative survey between economists at the University of Oxford, University of Zurich, and University of Cambridge.