82% Of Americans Say They Couldn't Afford $500 Emergency Thanks To COVID-19

A recent survey of 2,000 Americans carried out by Highland Solutions took a close look at how personal finances and spending habits have changed since the start of the COVID-19 pandemic, which crushed the US economy and has triggered a protracted downturn around the world.

With the US labor market adding just 245K new jobs last month, a sign that the sharp rebound from the chaos of March has already run its course and millions of Americans are waiting on more stimulus from Washington, the share of people living check-to-check has expanded rapidly.

Even before the pandemic, a staggering percentage of Americans didn't have enough cash on hand for an unexpected hardship of $400. But what's even worse for America's economy is that a majority of Americans have reduced spending, some dramatically, as the pandemic has made socialization difficult. According to the survey, 63% have cut back on spending since the start of the pandemic.

When asked for their reasons, respondents cited the need to be more cautious with their finances (60%), experiencing a reduced salary or income (49%), and staying home more often (40%).

For those who have cut back, 64% say they are spending less on dining out or takeout, 61% have reduced spending on entertainment such as concerts or movies, while 55% are buying less apparel, and 52% are spending less on travel. It is interesting to note that 21% of respondents say they have been spending more since the pandemic. Of those respondents, 51% say they are buying more food or groceries, and 50% are buying more household supplies.

After the unemployment rate spiked to more than 14% in April, Americans continue to be wary about their job security and income. According to respondents, more than a quarter feel they do not currently have a stable income, and 63% say they have been living paycheck-to-paycheck since the pandemic. Millennials appear to be the hardest hit demographic, as 64% say they are living paycheck to paycheck.

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