If nearly 40% of the nation anticipates spending the next 12 months in “survival mode,” it’s not a good sign for the coming year.
Traditionally, Americans look forward to the turn of the year with optimism, but this time around, things are different. 2020 brought the COVID pandemic, tremendous violence and civil unrest in major cities and the greatest economic downturn since the Great Depression.
Sadly, a large chunk of the country is anticipating more difficulties in the coming months.
Thirty-eight percent of the 3,011 adults who participated in the Fidelity survey said they will spend the year in “survival mode,” meaning they’ll focus on one day at a time rather than long-term goals to try to get themselves and their families through 2021.
Although some respondents maintained their usual income over the past year, 68% had setbacks. Of those, 23% lost a job or household income; 20% had an unexpected non-health emergency; 18% had to provide unexpected financial aid to family or friends; and 16% had a health emergency in their family.
As I keep reminding my readers, Americans have filed more than 70 million new claims for unemployment benefits this year, but even many of the people who have kept their jobs have fallen on hard times.
Another new survey found that approximately one-third of all full-time workers in the U.S. “have experienced a pay cut” in 2020. Roughly 1 in 3 full-time workers have experienced a pay cut due to the coronavirus pandemic, according to the MagnifyMoney survey of 984 professionals surveyed Nov. 6 to 11.
If you were employed throughout all of 2020 and you are still able to pay all of your bills on time, you should be very thankful for your blessings because you are now in the minority.
For most Americans, the past 12 months have been painful, and this new round of lockdowns promises to extend the economic suffering long into 2021.
Some industries that were absolutely devastated by the first round of lockdowns are officially in panic mode at this point. For example, we have permanently lost approximately 17% of the restaurants in the country, and the National Restaurant Association is warning that 10,000 more could permanently shut down “in the next three weeks.“
Even during the best of times, running a successful restaurant is difficult. The margins are razor thin, new competition is always popping up and employees are constantly coming and going.
When you add a global pandemic on top of all of that, it has become almost impossible for many eateries to keep going, and we are being told that the future for the industry looks quite “bleak.”
— Eighty-seven percent of full-service restaurants (independent, chain and franchise) report an average 36% drop in sales revenue. For an industry with an average profit margin of 5-6%, this is simply unsustainable. Eighty-three percent of full-service operators expect sales to be even worse over the next three months.
— Although sales are significantly lower for most independent and franchise owners, their costs have not fallen by a proportional level, with 59% of operators saying their total labor costs (as a percentage of sales) are higher than they were pre-pandemic.
— The future remains bleak, with 58% of chain and independent full-service operators expecting to continue furloughs and layoffs for at least the next three months.
Of course, it isn’t just the restaurant industry that is laying off workers in large numbers.
Just about every day there are more major layoff announcements in the news, and many experts are expecting the job-loss numbers to accelerate into 2021.
Without paychecks coming in, millions of unemployed Americans are unable to pay the bills, and we are being warned that we could be facing a historic tsunami of evictions starting just after the holiday season.
The day after Christmas, the extended unemployment benefits that have kept 12 million people and their families afloat are scheduled to expire. Then, mere days after that cliff, on New Year’s Day, a national ban on renter evictions from the Centers for Disease Control and Prevention is also set to lapse.
Overnight, an unprecedented bill of $70 billion in unpaid back rent and utilities will come due, according to estimates by Moody’s Analytics Chief Economist Mark Zandi. In all, up to 40 million people could be threatened with eviction over the coming months, research from the Aspen Institute says.
The politicians insist that they are keeping us caged up for our own good, but the truth is that they are absolutely destroying millions of lives in the process.
There is a lot of debate about whether or not the lockdowns have helped to prevent the spread of the virus, but what we do know is that thousands of businesses have been permanently destroyed, millions of jobs have been lost, more people are committing suicide and Americans are increasingly engaging in self-destructive behaviors.
Overall, 1 in 3 Americans report binge drinking during the coronavirus pandemic. The average person also reports spending about four weeks in lockdown this year—spending 21 hours a day at home. More than 7 in 10 people in the survey did not even leave their home for work.
If we cannot handle the COVID pandemic, how is our society going to be able to handle what else is coming?
As things continue to unravel around us, people are going to be in great need of hope.
Millions of Americans are already in “survival mode,” and the road ahead is certainly not going to get any easier. {eoa}
Michael Snyder is the author of four books. He has been a frequent guest on major radio and television shows all over the nation, and his websites have been viewed more than 100 million times.
Originally published at The Economic Collapse. Reposted with permission.
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