Over the past eight weeks, 36 million Americans have filed for unemployment benefits thanks in large part to the COVID-19 pandemic. These numbers are unprecedented, as is the speed in which they’ve occurred.
If you’ve just lost your job due to the COVID-19 pandemic and you’re not sure what to do, read on for a list of helpful steps and tips to help you navigate this difficult time.
What’s Ahead:
Who is losing their job to COVID-19
It’s hard to keep up with the economic destruction from the coronavirus. Each day unemployment continues to rise and more people are feeling the stress and pressure that accommodate a job loss.
While it seems nearly every industry has been impacted in some way by the coronavirus, certain ones have felt it more than others. Below is a list of some of the people and industries that have been hit the hardest.
Women
According to statistics from the Institute of Women’s Policy Research released in April 2020, it was reported that nearly 60% of the people who experienced job loss due to the coronavirus were women. Women were found to have lost more jobs than men across nearly every economic sector with the highest job losses occurring in leisure and hospitality, education and health services, as well as retail trade.
It is suspected that the reason for the disproportionate amount of job loss among women is because the industries that are seeing the most job loss are dominated by women.
Low-income households
A recent survey by the Pew Research Center reported that 52% of lower-income adults report that someone in their household has lost a job or taken a pay cut as a result of COVID-19. This is compared to 43% of adults overall.
People in lower-income brackets also report to be less prepared to take a financial hit like the one they’ve been dealt by the coronavirus, so this comes as a double whammy.
Teenagers
Young workers are experiencing high rates of unemployment thanks to coronavirus. As of April, the unemployment for adult women was around 4% whereas unemployment for young women (16 to 19 years) was in the double digits at 14.3%. This trend was the same for young men.
Leisure and hospitality
This probably doesn’t come as a huge surprise, but there was a large amount of job loss in the area of leisure and hospitality. As most of us have been under some degree of self-quarantine and non-essential businesses have been closed, it’s been a difficult time for those in hospitality, especially food services.
Healthcare and social assistance
I know, in a healthcare crisis it seems a bit odd that healthcare workers would be among those who are losing their jobs to COVID-19, but it’s true.
According to the Bureau of Labour Statistics, healthcare saw a large decline in jobs in the areas of dentistry, physician offices, and the offices of other healthcare professionals.
Retail trade
Everything from clothing stores to furniture and sporting goods. With the closure of all non-essential businesses, retail workers have taken a hard hit.
Why are people losing their jobs to COVID-19?
People are losing their jobs to COVID-19 largely because of mass shut-downs of services deemed as “non-essential.” When people are no longer flying, traveling, shopping at malls, going to the dentist, getting massages, attending sporting events, or even having elective surgeries, then job loss becomes an unfortunate result.
If there are no travelers, no customers, no clients or patients, then there’s no money rolling in, and, in many cases, business owners are not financially able to keep their staff employed.
What should you do if you lose your job?
If you’re one of the millions of Americans who has lost their job there are things you can do. Of course, you should give yourself a minute to digest what has happened. It’s okay to be angry or devastated, or whatever combination of emotions you are feeling.
When you’re ready to take action, here are a few things you can do.
Apply for unemployment
With an influx of people applying for unemployment, you are going to want to do this quickly to ensure that you get your check as soon as possible.
For more information on how to file for unemployment and if you are eligible you can visit the Department of Labour website here.
Review your budget
With less (or no) money coming in each month due to job loss now is a good time to create a budget, or review your budget if you already have one.
Start by determining how much money you’re bringing in each month. Next, review how much you’re spending based on your non-discretionary (needs) and discretionary (wants) expenses. Go through your discretionary expenses and be ruthless in cutting out anything that you don’t need – memberships, subscriptions, etc.
Assess your debts
Contact anyone you owe money to and see what kind of relief they can offer you during this time. This includes things like:
Student loans
As part of the CARES Act federal student loan borrowers can temporarily stop making monthly payments starting March 13, 2020, to September 30, 2020. The interest rate on some federal loans has also been set to 0%. To see if the 0% applied to your loan you can find more information here.
Mortgages
If you can continue to make your mortgage payments you should. If you can’t then the Consumer Financial Protection Bureau recommends the following steps:
- Determine who services your mortgage (who are you paying?).
- Determine if your mortgage is federally backed. Federally owned or backed mortgages are eligible for relief through the CARES Act. The CARES Act prevents your lender from foreclosing on you for 60 days after March 18, 2020. It also allows you to request a forbearance (temporarily postpone mortgage payments) for up to 180 days if you are experiencing financial hardship because of the coronavirus.
- If your mortgage is not federally backed you should still reach out to your provider to see what kind of relief they can offer.
- Check to see if your state is offering additional mortgage relief options.
Banks and credit cards
Many banks and credit card companies are offering relief to those who have been impacted by the coronavirus. If you need to defer or reduce your payments it’s important that you contact your bank or credit card lender as soon as you can.
Banks like HSBC are offering special relief and programs to those who have been impacted by the coronavirus pandemic.
HSBC is providing a series of programs to help people out during this difficult time. They are doing everything from waving fees and CD early withdrawal penalties on their deposit accounts, to providing assistance on loans, credit cards, and lines of credit, as well as providing mortgage assistance.
They are also waiving fees and providing assistance options when it comes to their business accounts. If you’ve been affected by COVID-19 make sure you take advantage of these special programs.
Use your emergency savings
Losing your job to COVID-19 qualifies as a legitimate reason to dip into your emergency savings. So, if you have to use some of this money, do it, and don’t feel bad about it.
However, now is also the time to build your emergency fund if possible. If you want to boost your savings and have the means to do so, you can use a resource like the CIT Savings Builder.
The CIT Savings Builder account rewards those who maintain a balance of $25,000 or more, or contribute $100 each month with a higher APY.
With the Savings Builder account the more you save, the more you earn. Signing up for a CIT Savings Builder account is super easy and can be done from the comfort and safety of your home. You’ll need a minimum of $100 to open your account which you can transfer electronically or by mailing in a check, or wire.
Refresh your resume
If you’re out of work and looking for something to do, why not refresh your resume, work on your interview skills, or take a course and learn something new?
Now is a great time to think about what you want to do for work and then pursue the skills needed. You can check out some free online course options offered by sites like Coursera or, go Ivy League and check out some special offerings from Harvard University.
Look for a job
Of course, this is not an ideal time to be looking for employment but there are jobs out there. People are still hiring despite the coronavirus pandemic, so be persistent.
Certain industries and jobs are seeing an increase in demand for their products or services as a result of coronavirus. Focus your search around industries that are hiring:
- Healthcare – Specifically pharmacies. People still need to get their prescriptions and CVS is hiring.
- Shipping – Think package handlers. Thanks to self-quarantine, no one is going out, but there’s no shortage of online orders being made. Check out FedEx.
- Delivery – Whether it’s food, packages, or booze, goods need to get from point A to point B. Think Instacart.
- Communications – I think it’s fair to assume that most of us have experienced our share of zoom calls during the pandemic. FYI, Zoom is hiring.
The Federal Government also has listings of what they are referring to as “mission-critical jobs” that will have a direct impact on the COVID-19 response.
What resources are available to those who have lost their jobs to COVID-19?
In addition to the resources we’ve already mentioned (unemployment, mortgage assistance, etc) you can also seek assistance through the CARES Act, for individuals and families as well as help for your small business.
The CARES Act
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides eligible American workers and families relief through the Economic Impact Payments (EIP).
Those with an adjusted gross income (AGI) up to $75,000 for single filers, $112,500 for head-of-household, and $150,000 for married filing jointly are eligible to receive $1,200 for individuals and $2,400 for married filing jointly. Additionally, eligible individuals can collect an additional $500 per qualifying child.
Those who make higher incomes will have their EIP payments reduced by $5 for each $100 above the $75,000/$112,500/$150,000 thresholds.
Single filers whose income exceeds $99,000, head-of-household filers who exceed $136,500 and joint filers who exceed $198,000 and have no children, are not eligible and will not receive a payment.
If you file your taxes then there’s nothing else you need to do to receive this payment. However, if you don’t file you can use the “Non-Filers” application in order to receive your payment.
The Paycheck Protection Program is also available to eligible small businesses to help the employer cover costs and keep their employees on the payroll for up to eight weeks.
Additional help
You can also check out the Benefits.gov website which offers a comprehensive listing of federal benefits that you might be eligible for.
Similarly, USA.gov highlights federal assistance programs that can assist with everything from food to healthcare and finances.
In addition to financial help, it’s also important that you maintain your mental health during this difficult time. If you feel like you need assistance you can visit the Mental Health America site to help you locate resources.
Summary
The loss of a job is major but there are things you can do to try and keep your head above water and avoid a mountain of additional debt. Remember, we are all in this together and most banks and financial lenders have set up relief programs so reach out and ask what they can do for you.
If you have emergency savings now is the time to use them. However, if you have the financial means to sustain yourself, or even add to your emergency account, definitely do it. Unfortunately, we don’t know how long the financial or health effects of COVID-19 are going to last so you want to prepare for the worst and hope for the best.
If you’ve lost your job time is of the essence, you want to apply for unemployment and other benefits as soon as you can to ensure you are able to continue paying your bills and avoid using credit cards or other loans.
While COVID-19 has dealt a disastrous and unpredictable hand we will get through this. We will get back to a new normal and hopefully emerge stronger than ever.
Read more:
- Dealing With Financial Hardship Due To The Coronavirus? Here’s What You Can Do
- How Small Businesses Are Handling The Coronavirus Pandemic
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