COVID-19 Pandemic Erases Years of Financial Gains in Months, Disproportionately Affecting People of Color, Women, Gig Worke...
July 13 2020 - 11:00AM
Business Wire
Almost half of Americans are worried
about their financial future
The first months of the COVID-19 pandemic largely wiped out
three years of financial gains in the United States, with more than
half of Americans reporting their financial health has been
compromised. People of color, women, younger generations and small
business owners were among those disproportionately affected,
Prudential’s (NYSE:PRU) 2020 Financial Wellness Census™ finds.
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John Kalamarides, President, Prudential
Group Insurance (Photo: Business Wire)
“This crisis exposed deep fissures in our public health and
economic systems, pervasive racial and social inequity, and how
weak our collective immunity is to financial disruption,” said John
Kalamarides, president of Prudential Group Insurance. “Tackling
these systemic vulnerabilities will require bold thinking and
public/private partnerships to help our society overcome financial
fragility and prosper through an inclusive recovery.”
Fielded in May 2020, the study shows nearly one-in-five
respondents said their household income was cut by half or more in
the months following the pandemic’s outbreak, with 17% losing
employer contributions to a retirement plan, 14% losing health
insurance and 10% losing group life insurance benefits, eliminating
critical safety nets.
The negative impact is disproportionately high for certain
segments of the population. For example, while 48% of all of those
surveyed said they were worried about their financial future, 56%
of Black Americans and 56% of Latino Americans said they were
worried about their financial futures. And while 17% of all
Americans reported being unemployed, that figure was considerably
higher for those with household income under $30,000 (34%) versus
those with household income of over $100,000 (8%).
Where 17% of respondents said their household income was cut by
half or more, that number rose to 31% for gig workers, 25% for
LGBTQ Americans and 24% for those employed in the retail
industry.
The results are a startling contrast to findings just months
earlier, in December 2019, showing Americans were financially on
the upswing. More than half (52%) ranked themselves financially
healthy by objective measures, up from 46% in Prudential’s first
Financial Wellness Census conducted in October 2017.
Additionally, the economic fallout from the pandemic shrunk the
portion of respondents who qualified as financially confident to
36% from 40% in 2019, while swelling the number of those who are
discouraged to 33% from 31% in 2019. Regardless of household
income, the survey revealed nearly half of Americans (48%) are
worried about their financial future, up from 38% just a few months
earlier.
Asked what changes they would like to see as a result of the
COVID-19 pandemic, census respondents cited more affordable health
care, more flexible work options and better government programs to
support small businesses. Those with lower incomes were most
focused on changes that strengthen their finances and social safety
nets, citing affordable health care and universal health care
coverage, better government support of small businesses and the
unemployed, a higher minimum wage and more protections for
workers.
The data also show that Americans most often look to the federal
government for financial assistance in times of crisis (32%),
followed by family and friends (28%), then state and local
governments (27% and 17%, respectively).
Employers also play a critical role when it comes to financial
health. The workplace benefits Americans most value include
retirement savings opportunities, paid time off, and comprehensive
health care and prescription drug coverage, according to the
census.
Read the full report for more information.
About Prudential Financial
Prudential Financial, Inc. (NYSE:PRU), a financial wellness
leader and premier active global investment manager with more than
$1 trillion in assets under management as of March 31, 2020, has
operations in the United States, Asia, Europe, and Latin America.
Prudential’s diverse and talented employees help to make lives
better by creating financial opportunity for more people.
Prudential's iconic Rock symbol has stood for strength, stability,
expertise and innovation for more than a century. For more
information, please visit news.prudential.com.
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MEDIA: Rebecca Rickert 973-943-6679
rebecca.rickert@prudential.com
Yue Jiang 973-204-6665 yue.jiang@prudential.com
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