Which Workers Have Been Most Affected by the COVID-19 Pandemic?

July 30, 2020

How has the labor force been affected by the COVID-19 pandemic? A recent Economic Synopses explored which workers were hardest hit in terms of unemployment from January to April.

Using the Current Population Survey, St. Louis Fed Economist Serdar Birinci and Research Associate Aaron Amburgey broke down occupations into five equal-sized groups based on average annual earnings:

  • Those earning less than $34,963, which includes occupations such as cooks, servers, janitors and cashiers
  • Those earning $34,963 to $48,293, which includes medical assistants, clerks, construction workers and customer service representatives
  • Those earning $48,293 to $60,165, which includes elementary school teachers, retail salespersons, and maintenance and repair workers
  • Those earning $60,165 to $83,807, which includes registered nurses, industrial mechanics, accountants and computer support specialists
  • Those earning more than $83,807, which includes physicians and dentists, lawyers, financial managers and sales representatives

Jobs Most Affected by COVID-19

Looking at this breakdown, the authors noted that the lowest-paid group is dominated by service-industry occupations; the second-lowest-paid and middle groups include mostly manual workers and office workers; the second-highest-paid group consists of mostly technical occupations; and the highest-paid group is mostly a mix of executive and various professional occupations.

Birinci and Amburgey then calculated the change in unemployed workers from January to April that belong to occupations in each group. They found that the occupations in the two highest-income groups accounted for only 17% of the total increase in unemployment, while occupations in the lowest-income group alone accounted for 34% of the total increase.

“This finding provides evidence that the majority of the jobs being destroyed—or at least furloughed—by the COVID-19 crisis are in occupations with lower earnings,” they wrote.

Disparate Unemployment Rates

Finally, the authors estimated the increase in the unemployment rate for workers in occupations in each of these five income groups, as shown in the table below.

Unemployment Rate for Occupations Grouped by Average Annual Earnings
Less Than $34,963 $34,963-$48,293 $48,293-$60,165 $60,165-$83,807 More Than $83,807
January Unemployment Rate 5.6% 4.4% 2.8% 2.2% 2.2%
April Unemployment Rate 26.0% 17.8% 13.5% 7.4% 5.3%
Percentage Point Change 20.4 13.4 10.7 5.2 3.2
SOURCE: 2019-20 Current Population Survey.

Birinci and Amburgey noted that the unemployment rate in January was relatively low for each group, but particularly for those in the middle and the two highest-earning groups. In April, the rate was extremely high for the middle and two lowest-earning groups, while it was more moderate for the two highest-earning groups.

“In conclusion, workers in occupations with lower average earnings were disproportionally displaced by the COVID-19 crisis, while workers in occupations with higher average earnings—especially those in the top 20 percent—were impacted to a lesser extent,” they wrote.

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This blog offers commentary, analysis and data from our economists and experts. Views expressed are not necessarily those of the St. Louis Fed or Federal Reserve System.

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