In just the past few weeks alone, millions of Americans have lost their jobs. Approximately 22 million people filed for initial unemployment benefits between mid-March and mid-April, and more layoffs may be coming as businesses close their doors in an attempt to mitigate the spread of COVID-19.
If you're fortunate enough to still have a job, don't let your guard down just yet. Some workers are more likely than others to be laid off in the relatively near future, according to new research. Here's who is most at-risk.
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The workers most likely to be victims of layoffs
Layoffs over the last few weeks have been brutal, but they may not be over just yet. Roughly 67 million Americans are currently at a high risk of being laid off from their jobs, according to research from the Federal Reserve Bank of St. Louis.
Using occupational data from the Bureau of Labor Statistics, researcher Charles Gascon examined over 800 jobs and determined which ones were at the highest risk of facing layoffs due to social distancing measures. The factors he examined included whether these jobs were considered essential to public health and safety, whether the job can be performed remotely, and whether the employees are salaried. Those who are considered essential or who are able to work from home are at a lower risk of being laid off due to COVID-19.
Some of the employees he determined are most at risk of being laid off are those who work in industries including sales, food preparation and service, production operations, and installation, maintenance, and repair. Altogether, these "high-risk" employees make up roughly 46% of the U.S. workforce.
Those in the "high-risk" group also tend to earn lower wages, earning an average of around $36,600 per year. That in comparison to those who are at a lower risk of being laid off, who earn an average of roughly $64,600 per year.
How to prepare for potential layoffs
These are unprecedented times, and there's no instruction manual for how to prepare for a potential job loss due to a pandemic. That said, there are a few steps you can take to make sure you're as prepared as possible.
One of the best ways to prepare for the worst is to build a robust emergency fund. If you do lose your job, you may not be able to find another one for at least a couple more months -- or more, if the country slips into a recession. In that case, you might need to survive on your emergency savings for a while.
Building an emergency fund can be tough, especially if you don't have much cash to spare right now. But do your best to comb through your budget and see if you can find any spare change to put toward your savings.
If you don't have any savings at all and are worried you're at a high risk of losing your job, you might consider making some drastic budget cuts to save as much as you can. Slash any expenses that aren't 100% necessary, and park that extra cash in a high-yield savings account so it can start earning interest immediately.
In addition, take advantage of any other financial resources you have available. For example, federal student loan payments are suspended until Sept. 30 under the recently passed Coronavirus Aid, Relief, and Economic Security (CARES) Act, so you might consider skipping your loan payments until then to free up some cash in your budget.
Also, reach out to your creditors -- such as your mortgage lender or credit card issuers -- to see if they offer any payment assistance programs. Many of these organizations are offering assistance on a case-by-case basis, so it never hurts to ask about what kind of financial help may be available to you. By saving money on your other bills, you can put more of that cash toward your emergency fund.
The coronavirus pandemic has changed the way we live our daily lives, and it's caused significant financial hardship for millions of Americans. There's no way to predict for sure how safe your job is, but by building a solid emergency fund, you'll be prepared for nearly anything.
