The Federal Reserve Board recently released its Report on the Economic Well-Being of U.S. Households. The report provided results from the responses to the 2019 Survey of Household Economics and Decision making (SHED) which was conducted before the COVID-19 pandemic, as well as the responses to a smaller follow-up survey conducted in April 2020 to better understand the financial disruptions caused by COVID-19. Surveyed items included income, employment, dealing with expenses, banking and credit, housing, education, retirement, student loans, and other education debt.
At the end of 2019, the overall economic well-being has improved since the survey began in 2013. The supplement survey found that financial conditions changed dramatically when the COVID-19 pandemic intensified in March 2020 for many families especially those who experienced job loss or reduced hours.
Fewer adults reported that they were at least “doing okay financially” in April 2020 than they had been at the end of 2019. From March to early April 2020, 19 percent of adults reported losing jobs or having their hours reduced. Seventy-two percent of adults reported “doing okay” (43 percent) or “living comfortably” (29 percent), which is down from 75 percent of adults who were at least “doing okay financially” in 2019.
This sharp decline in financial well-being was concentrated among those who experienced a layoff or reduction in work hours. Among those adults not being affected by the pandemic, 76 percent of adults noted they were at least “doing okay financially” in April, which is similar to overall share of adults “doing okay” in 2019. However, among those who experienced job loss or reduced hours, only 51 percent indicated that they were at least “doing okay” in April.
In addition to employment, work schedule and location may affect financial well-being as well. Working an irregular schedule was often associated with financial strain and working at a job site or at customer’s location could add uncertainty in a worker’s day. Eighty-two percent of adults who worked from home said they were “doing at least okay” financially, while 71 percent of adults who worked at a remote location were “doing at least okay” financially.
The likelihood of being able to work from home varied by education level. Survey found that workers with bachelor’s degree or higher are more likely to work from home, and workers without college education are more likely to work at a remote location (neither their home nor a place that belongs to their employer) (Figure 1). This difference was amplified by social-distancing measures which have been implemented as a response to COVID-19 pandemic.
Though some reported a job loss or a reduction of hours, most workers worked from home due to the COVID-19 lockdown in the April survey. In October 2019, only 7 percent of workers reported usually working from home, while in the last week of March, 53 percent of workers did at least some work from home and 41 percent did all their work from home.
Consistent with previous findings, workers with higher education were more likely to work from home during the COVID-19 pandemic (Figure 2). The supplement survey showed that 63 percent of workers with bachelors’ degree or above worked entirely from home, while 20 percent of workers with high school degree or less worked entirely from home.