Nearly one-quarter of U.S. adults lost ground financially in 2020, the largest proportion since the annual survey began in 2014, according to the U.S. Federal Reserve’s report, “The Economic Well-Being of U.S. Households in 2020,” released 17 May.
About 45 percent of workers who had been laid off were unable to meet their expenses in November or lacked the means to meet an unexpected $400 expense, the study found.
The economic shutdown also worsened inequalities already separating racial minorities and under-educated persons from the middle class, the report said.
“A clear pattern from the survey is that financial challenges in 2020 were uneven, and frequently left those who entered the year with fewer resources further behind,” it noted.
Among those reporting to have survived 2020 without crashing financially, a full 44 percentage points separated those with a bachelor’s degree and adults who lacked a high-school diploma.
The spread was ten points greater than in 2019.
Barely a third of African-American and Latino adults said they were all right financially in 2020, contrasted with 80 percent of white adults and 84 percent of Asians.
“Even as the economy has improved, we can certainly see that some are still struggling, especially those who lost their jobs and those with less education, many of whom fell further behind,” said Fed Governor Michelle Bowman in a statement accompanying the report’s release.
About 22 percent of parents told the survey they were working less or not at all because of the shutdown; the group included a large proportion of single and low-income mothers as well as African-American and Hispanic parents.
TREND FORECAST: When rent payment moratoriums are lifted, economic conditions for those most vulnerable will further deteriorate for those out of work or working and not having enough money to pay for what they owe. Also, the homeless population and crime levels will increase.
