Coronavirus pandemic causes drop in income for UK households

Employees, the self-employed, and people on zero-hour contracts, are expecting an average 22% drop in income - including wages and benefits - on the back of the coronavirus pandemic, according to research by national poverty charity, Turn2us.

People on zero-hours contracts are being hit the hardest by coronavirus, with more than three out of four people (78%) having seen a drop in income or change to employment. This means they are losing £193 from their monthly income and are now expected to live on around just £614 per month. One in four of them are not receiving any pay because their work has closed.

More than half (57%) of self-employed workers have already had their employment affected (income and/or hours reduced) as a result of the pandemic. They are expecting to see the largest drop in take-home income of £386 each month.

This is followed by more than one in two (53%) employed people having reported changes to income or employment status so far; and are expecting to see a drop in income of £219 per month.

Anna Stevenson, Welfare Benefit Expert at Turn2us, said:

“People across the country are facing a dramatic loss of income, and many will face rising debts, possible hunger, and potentially even homelessness as a result.

“The government needs to design policies to ensure not only that people survive this crisis, but that they are able to thrive in the long term. We are urging them to increase the generosity of benefits, end the five week wait for Universal Credit and to extend the employee and self-employed wage schemes.”

In March and April this year, Turn2us saw a huge surge in demand for services, including an almost 200% increase in use of online tools, compared with the same period in 2019. The charity has awarded £1,963,336 worth of crisis grants since the pandemic started, providing a financial lifeline for many self-employed and zero-hour workers who are worst hit by the lockdown.

The Turn2us research was conducted between the 22 to 27 April 2020 via Censuswide with a total sample size of 2,065.  The figures presented here have been weighted and are representative of all UK adults (aged 18-65) according to age, gender, and region and have been analysed independently by Turn2us.