Industries hit the hardest by COVID OR Ever thought about a government job?
As hard-hit industries rebound from job losses, now is a good time to prepare for next emergency.
Federal employees are the only group to make it through the pandemic without significant job losses. Every other major industry saw a rise in unemployment, with leisure and hospitality hit the hardest.
MagnifyMoney researchers examined U.S. Bureau of Labor Statistics job data to find the industries that lost the most personnel and determine which ones have recovered the best. This is what they found:
Leisure and hospitality by far was the hardest-hit industry at the beginning of the pandemic, losing 49 percent of its workforce between February 2020 and April 2020. The number of people working in leisure and hospitality — including arts, entertainment, recreation, accommodation and food jobs — fell by 8.2 million.
The “other services” industry — including repairs, maintenance, personal care and religious organizations — took the second-biggest hit early in the pandemic, losing 24 percent of its personnel. Even after recovery, the total number of people employed in this industry remains 5 percent below pre-pandemic levels.
The hardest-hit industries may be recovering fastest. The leisure and hospitality industry took the biggest hit, but it since has seen the most robust growth. The number of people working in leisure and hospitality grew by 70 percent between April 2020 and June 2021. Still, the total number of workers in the industry remains 13 percent below its February 2020 level.
A federal government job might be a safe bet against future catastrophe. The number of people working for the federal government is unchanged since before the pandemic, making it the only industry to remain flat. Local and state government employment fell only marginally.
On top of losing the most jobs, those in the hospitality and leisure industry also earned the lowest wages across the industries analyzed. Taking home an average of $437 a week in June 2020, it’s easy to imagine many of these workers being financially unprepared for a sudden loss of income.
Those working in the retail trade industry earned $646 a week on average in June 2020, seeing one of the largest drops in the labor force with a 15 percent decrease from February 2020 to April 2020. The education and health services sector lost 12 percent of its workforce, and those who remained employed earned an average of $944 a week in June 2020.
Before the next global crisis unfolds, consumers should do their best to financially prepare by building — or in some cases rebuilding — robust emergency savings, said Max Schulz, chief credit analyst for LendingTree.
“You never know when that rainy day is going to come or just how strong that storm will be,” he said, “but you know one will come eventually, so the more prepared you can be with emergency savings, the better off you’ll be.”
He makes these recommendations to prepare for a potential financial disaster in the future:
Every little bit helps. Saving six months’ worth of expenses in an emergency fund is an ambitious goal. “For many of us, it simply isn’t realistic,” he said. “But that doesn’t mean you shouldn’t try, because contributing even a small amount to a high-yield savings account as often as possible will help your savings grow even when you can’t contribute.”
There’s no such thing as being overprepared. “If the pandemic has taught us anything, it’s that emergencies can last a long time,” Schulz said. “Even if you think you have enough cash in savings, it’s a good idea to keep adding to it. The truth is that if you think you have enough money saved, there’s a good chance that you really don’t. When in doubt, put a little more away.”
Make the most of savings. It’s one thing to have a good amount saved, but it’s another to make sure it’s safe and growing at a competitive pace. Don’t settle at a bank just because it’s familiar. Compare the best savings account rates, and look for bonus offers that can give you an extra boost.
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