Board of Governors of the Federal Reserve System

Employment

Fewer people were working in late 2020 than before the COVID-19 pandemic, and layoffs frequently fell on workers who were already in more precarious financial positions. Employment losses were largely due to layoffs in March that many workers expected to be temporary. Yet at the time of the survey, many laid-off workers had not returned to their old jobs.

Beyond the effects of the pandemic on the availability of work, the 2020 survey showed the wide array of work arrangements, including part-time and gig work, and the varied reasons that some people were not working. More people cited lack of work in 2020, but many others were not working because of concerns over their health or because of their obligations to care for others. An especially large share of people worked from home, though doing so was far more common among workers with college degrees.

Layoffs and Job Loss

The pandemic led to large declines in employment, with many layoffs occurring in March 2020.¹⁹ Four percentage points fewer adults were working in late 2020 compared with 2019, and 14 percent of all adults were laid off over the prior year.

Adults with less education were more likely to have been laid off. Sixteen percent of adults with less than a college degree were laid off in the prior year, compared with 11 percent of adults with at least a bachelor's degree. Among prime-age adults (ages 25 to 54) who were more likely to be working before the pandemic, 20 percent with less than a bachelor's degree were laid off, compared with 12 percent of those with at least a bachelor's degree (figure 9).²⁰ Hispanic and Black adults were also particularly likely to have been laid off. Over 20 percent of both Black and Hispanic prime-age adults were laid off in the prior 12 months.

Slightly less than one-fourth of adults who were laid off in the prior 12 months had returned to their former jobs as of late 2020 (figure 10), and 52 percent had either returned to or expected to return to their former jobs in the future. In contrast, the April 2020 SHED supplement found that 86 percent of workers who had been laid off between February and April had expected to return to their former jobs at that time. In November, 24 percent of laid-off adults were not expecting to return and did not have another job.²¹

People who were laid off were doing worse financially, and those who were laid off and still not working were faring particularly poorly financially. Fifty-six percent of workers who were laid off were doing at least okay financially, compared with 78 percent of those who were not laid off. An even smaller 44 percent of laid-off workers who were neither expecting to return to their old jobs nor working at another job were doing at least okay financially (figure 11).

Reasons for Not Working

Twenty-six percent of prime-age adults were not working in the month leading up to the survey, up from 21 percent in 2019. The most commonly cited reasons for not working were health limitations, an inability to find work, and childcare or family obligations; each was cited by 9 percent of all prime-age adults (or one-third of those not working) (figure 12).

Not being able to find work was much more frequently cited in 2020 compared with 2019, increasing by four percentage points among all prime-age adults. Health limitations and childcare or family obligations had more modest increases, each increasing by around 1 percentage point.

Women who were not working disproportionately said that childcare and family obligations kept them from formal employment (figure 13). Fourteen percent of all prime-age women (43 percent of prime-age women who were not working) cited either childcare or family obligations. A smaller 5 percent of all prime-age men (24 percent of those not working) cited these reasons.

Part-Time and Temporary Jobs

Fourteen percent of adults worked part time and 4 percent said that their main job was a temporary position. The share of adults who were working part time declined by 2 percentage points from 2019 to 2020.²² Part-time work was more common among women than among men. Sixteen percent of women worked part time, while 11 percent of men did.

Slightly more than half of part-time workers said that they would like to work more hours. In particular, 70 percent of Hispanic and 53 percent of Black part-time workers said they wanted to work more hours. Hispanic adults were also slightly more likely to be working part time than workers overall.

People who had a part-time or temporary job reported more financial strain than people who worked full time. Thirty percent of part-time workers and 33 percent of temporary workers said that they were either just getting by or finding it difficult to get by. A smaller 17 percent of permanent, full-time workers reported the same levels of financial strain.

Some workers also had irregular schedules. Sixteen percent of employees had a work schedule that varied based on their employer's needs. Ten percent of employees had a schedule that varied at their own request. Collectively, just over one-fourth of employees had a varying work schedule.

Workers with irregular schedules they do not control tend to be under more financial strain. Thirty percent of workers with a schedule that varied based on their employer's needs said that they were either just getting by or finding it difficult to get by. This compares with 18 percent of workers with a fixed schedule or with a schedule that they control.

Working from Home

A major change in many people's work environment since 2019 is the prevalence of working from home. In 2020, 29 percent of adults who worked for someone else worked entirely from home or by telecommuting. This is similar to the 31 percent who worked entirely from home in July, but down from the 41 percent who did in April. In contrast, only 7 percent of adults who worked for someone else typically worked from home in 2019.²³

Workers with more education have been much more likely to work from home during the pandemic. Forty-six percent of workers with at least a bachelor's degree worked entirely from home in the month before the survey (figure 14). Nineteen percent of workers with some college, and 10 percent with a high school degree or less, worked entirely from home.

Older workers were less likely to work from home. Twenty-five percent of employees ages 55 to 64 worked entirely from home. For comparison, 33 percent of employees ages 25 to 34, as well as those ages 35 to 44, worked entirely from home or telecommuted.

The Gig Economy

Gig activities (gigs) in this report include paid childcare, house cleaning, ride sharing, selling goods, and renting out property.²⁴ Most gigs predate the internet, though some occur online. They do not always fit into standard concepts of "employment" because people can do gigs occasionally and without firm time commitments. Yet gigs could help people to supplement income, and, for some people, they are a primary source of income.

Although gigs can help to supplement income after layoffs, the large number of layoffs in 2020 were not accompanied by an increase in the share of adults who performed gig activities. Instead, 4 percentage points fewer adults said that they earned money from gigs in the month before the 2020 survey compared with 2019. Still, 27 percent of people earned some money from gigs, and 8 percent were regular gig workers, in that they spent 20 or more hours in the prior month on gigs.

Many people who performed gig activities also said that they spent less time on and earned less money from gigs compared to a year prior. Around 30 percent of people who did gig activities said that they earned less money and spent less time in the last month compared with a year ago (figure 15). Roughly 25 percent said that they were spending more time on and earning more money from gigs.²⁵

Gig work frequently supplemented earnings from a traditional job. Nearly half (47 percent) of gig workers also had full-time jobs, while 22 percent had part-time jobs. Thirty-one percent were not working for pay or profit in the last month, aside from their gig work.²⁶

Since many gig workers had other jobs, few relied on gigs as a primary source of income. Three percent of all adults (11 percent of gig workers) earned at least half of their income in the past year from gigs. Even among regular gig workers, slightly less than one-fourth earned at least half of their income in the past year from gig work.

Supplemental income from gigs also appeared to have played a limited role in smoothing people's earnings during the COVID-19 pandemic. Fewer people performed gig activities in 2020 and earnings from gigs were most often less than half of people's total earnings, even for regular gig workers. Additionally, 21 percent of people doing gig activities said that their work in the gig economy increased how much their income varies from month to month. Nine percent of all people who perform gig activities said that the activities reduced the amount that their income varied.²⁷

Although some of this gig work was coordinated online, most people coordinated gigs without apps or online platforms. Fourteen percent of adults who performed gig activities both found customers and received payments through an app or online platform, but 85 percent did not. Apps were slightly more common among regular gig workers, although even among this group just 20 percent used an app or online platform both to find customers and to receive payments. Each number has grown by 1 percentage point from 2019.

Selling goods made up a substantial share of gig activities reported in 2020 (table 7). Thirteen percent of all adults sold goods to make money in the month before the survey, including 9 percent who sold goods online and 7 percent who sold goods in person (3 percent did both). The share of adults who sold goods in the gig economy ticked down by 1 percentage point since 2019.

Table 7. Share of adults performing gig activities

Among people who sold goods, 72 percent sold goods that they previously owned for their own use, such as used clothing (figure 16). People less frequently sold goods that they acquired to resell, made themselves, or sold on behalf of a company.

In addition to selling goods, 16 percent of people performed service activities, such as house cleaning, yard work, or property maintenance; childcare; renting out property; dog walking; and ride sharing. The most frequent type of service activity was house cleaning, yard work, or maintenance, which 6 percent of adults earned money doing in the past year.

Since performing services often involves physical proximity, concerns about COVID-19 likely led to a decline in the share of adults performing services as a gig activity. The share performing service activities declined by 4 percentage points since 2019, and the decline occurred across many service activities.

 

References

 

 19. For more detail, see the Report on the Economic Well-Being of U.S. Households in 2019, Featuring Supplemental Data from April 2020, https://www.federalreserve.gov/publications/files/2019-report-economic-well-being-us-households-202005.pdf. Return to text

 20. Another way to consider layoffs among those most connected to the labor force is to look at respondents who completed the survey in both 2019 and 2020 and were working at the time of the 2019 survey. Twenty percent of people with less than a bachelor's degree who were working in 2019 were laid off in 2020, compared to 10 percent of those with at least a bachelor's degree. Return to text

 21. This question includes all people laid off from November 2019 until the survey. Consequently, the number of people who returned to their jobs could be lower than for layoffs beginning in March 2020 from the April and July 2020 SHED supplements. People who are expecting to return to their old jobs may either be employed in other jobs or unemployed. Return to text

 22. Using the overlapping respondents with the 2019 survey, 24 percent of people working part time in 2019 lost a job in the subsequent year, compared to 13 percent of people who were working full time in 2019. Return to text

 23. The question asked in 2019 was different from 2020. The 2019 survey asked where people worked in their main jobs most of the time. Return to text

 24. The list of gig activities and analysis of their relationship to reported employment was similar to Anat Bracha and Mary Burke, "Informal Work in the United States: Evidence from Survey Responses," Current Policy Perspectives (Boston: Federal Reserve Bank of Boston, 2014). For the further development of the gig questions now used in the SHED, see Barbara Robles and Marysol McGee, "Exploring Online and Offline Informal Work: Findings from the Enterprising and Informal Work Activities (EIWA) Survey," Finance and Economics Discussion series 2016-089 (Washington: Board of Governors of the Federal Reserve System, October 2016). Return to text

 25. The change in intensity of gig work was only asked of respondents who engaged in any gig activities so will not include those who stopped performing gig work completely. Fifty-four percent of respondents for both the 2019 and 2020 surveys who performed gigs in 2019 did not perform any gigs in 2020, so they did not receive a question about how they changed their gig activities in 2020. Return to text

 26. Gig questions are asked separately from the standard employment questions. Most regular gig workers said that they are working in typical employment questions. However, 2 percent of adults said that they were both not employed and spending at least 20 hours on gig activities in the prior month. Return to text

 27. Even if it does not reduce monthly income volatility, gig work can be used to offset lost work from formal jobs. In the Report on the Economic Well-Being of U.S. Households in 2016 (https://www.federalreserve.gov/publications/files/2016-report-economic-well-being-us-households-201705.pdf), 56 percent of adults performing informal gig work who experienced a job loss or decline in wages in their family felt that this income was somewhat or very important for offsetting the negative effects of reduced hours or wages in a formal job. Return to text