More than a third of full-time American workers have had their pay cut because of the coronavirus pandemic, according to the latest MagnifyMoney survey.
MagnifyMoney surveyed nearly 1,000 full-time American workers to gain a better understanding of pay cuts, pay raises and bonuses over the past year — and in the next year. The news isn’t all bleak, though: While many workers experienced a pay cut, more than half of full-time workers have received a pay raise in the past year — even though 8% fewer workers received one than in the previous year.
Key Findings:
- Just over a third (34%) of full-time workers experienced a pay cut due to the coronavirus pandemic. While men and women experienced pandemic pay cuts at nearly equal rates, men (52%) were more likely than women (44%) to say their pay has been restored.
- 54% of full-time workers received a pay raise in the past year, down from 59% in our 2019 report. Of those who got a raise, half were surprised by it, while a quarter asked for it.
More men (58%) received raises than women (48%). Additionally, men who received raises were more likely to be promoted compared to women. - The number of working Americans who think they’ll get a pay raise next year dropped by 17%, from 47% in 2019 to 39% in 2020.
- 28% of workers said their company made changes to bonuses amid the pandemic. In fact, 15% reported their company decided not to grant bonuses this year, while 13% said their bonus was reduced.
There was a significant age gap regarding pay cuts. Millennials (38%) were the most likely generation to experience a pay cut because of the pandemic; however, 53% of millennials had their pay restored after it was cut.
“It’s definitely encouraging to hear that millennials are likely to have their pay restored after a pay cut, as a lengthy cut in pay can cripple one of the more financially vulnerable generations,” said Sarah Berger, MagnifyMoney’s millennial finance columnist.
“Many millennials are struggling with crushing student loan debt and a weak job market at a time when many are also likely considering making serious financial decisions, such as buying a home, getting married and having children,” she added. “It’s essential for millennials and other young generations to be on solid financial footing before they make these big purchases.”
