April Non-Prime Tracker Update

Each month the Non-Prime Tracker provides fascinating insights into how Americans, prime and non-prime alike, have fared throughout the pandemic. Every month gives a new surprising look into how circumstances can change, but also gives us an aerial view of how people have been faring since before the pandemic even began. In this month’s April edition of the report, we will take a more comprehensive look into how things have changed from before the pandemic, at its early stages, to now as more and more folks are getting vaccinated and the economy is opening back up.

Unemployment

The non-prime population felt job loss and unemployment almost immediately as the pandemic began in the second quarter of 2020. The unemployment rate jumped and has remained steadily high for that population. In contrast, the prime stayed low after the start of the pandemic and it rose slowly as the economic took the hit.

Contract Work

Prime Americans have seen a rise in contract work throughout the pandemic. This is important to pay attention to, as many contract workers do not enjoy the same benefits of full time employment such as insurance options, or 401(k).

Household Income

In conjunction with the job loss felt in the early stages of the pandemic, Household Income for non-prime folks has decreased. Prime also experienced this decrease in income, but not quite as drastically.

Run Out of Money

Non-prime folks are accustomed to being in precarious financial situations, and our data shows they went into a savings mode to prepare for what the pandemic could bring. Non-prime people experienced running out of money at a lower rate after the pandemic began, than before. This metric rose during the holiday season, then dropped back down after the economic relief package in the first quarter of 2021. They also utilized the government stimulus checks to make ends meet throughout the uncertainty of the pandemic and economic recovery.

Daily Expenses

Since the start of the pandemic, non-prime Americans are struggling to make ends meet on daily expenses. Evidence shows that they may be also putting off medical, dental, car or other expenses to prepare for the financial uncertainty brought by the pandemic. Non-prime folks have experienced more volatility than prime people in this regard.

Access to Credit

Since March of 2020, both prime and non-prime Americans have struggled to obtain credit from traditional financial institutions. This is something that non-prime consumers struggled with before the pandemic, but now both groups are feeling a credit pinch with the uncertainty of the health crisis.  

Extraordinary Expenses

Prime Americans are experiencing a lot of volatility with extraordinary expenses, especially in the fourth quarter of 2020. Pocketbooks are typically pinched during the holiday season, and people still experience unexpected expenses such as car repairs or medical bills but with less of a cushion to help them through it.

Employment Stability

Directly after the pandemic began, there was a feeling of uncertainty and instability about employment status and the job market. Sentiment for both prime and non-prime people appears to be approaching pre-pandemic levels.

Job Loss

Many of the people who experienced layoffs or job loss as a result of the pandemic, did not receive the benefit of a severance package. This can contribute to a feeling of fragility as these workers try to find new employment in a strained job market.

Medical Insurance

Medical expenses can be one of the most destabilizing things to happen to a household’s finances. Prime Americans are much more likely to have insurance through their employer, while non-prime do not have that luxury. The rate at which non-prime people are offered insurance through their employer has slightly decreased throughout our current health crisis.

Personal Debt

With the job loss and uncertainty that accompanied the pandemic, many people, especially non-prime, have found personal debt much more difficult to manage.

Financial Security

Non-prime people are feeling much less financially secure as compared to before the pandemic. Given the sentiments of uncertainty, this doesn’t come as a surprise. As vaccine rollout continues, and the economy slowly returns this metric will be an interesting one to keep an eye on.

Direction of the Country

Before the COVID 19 pandemic took hold, non-prime Americans felt as though the country was not heading in the right direction and that only increased as the pandemic has took effect. Prime American has a higher approval of the country’s direction. It took a small dip during the pandemic but has since returned back to the pre-pandemic level.

Article By:

Jonathan Walker

Jonathan Walker

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