Millennials finances hardest hit by COVID-19

South Africa – The COVID-19 pandemic is causing similar financial challenges for consumers around the world, but new research indicates that millennials are being challenged the most.

A just-released TransUnion global report, including seven regions on five continents, found that 84% of South African millennials indicated their household incomes have been negatively impacted by the pandemic, compared to the global average of 76%.

A clear outcome from the research is that many consumers are worried about their finances, but the millennial generation (ages 26-40) is under the most stress. In the seven regions featured in the study, 22% of millennials with household incomes negatively impacted have lost their jobs due to COVID-19 compared to 16% for all other generations. Just under half (45%) of millennials with incomes negatively impacted have seen their work hours reduced compared to 35% for the rest of the group. This pressure is compounded by the fact that 61% of millennials said they have dependent children living at home – a much greater rate than the 39% noted for other generations. In South Africa, 66% of millennials in the survey have dependent children living at home, compared to 48% for other generations.

Millennials who have seen their household incomes negatively impacted also are having more pronounced problems with certain debt obligations. For instance, 63% with negatively impacted incomes report they will not be able to make their rent or mortgage payment compared to 54% for other generations.

“Millennials are the first generation to be fully immersed in mass-market digitalisation and are savvy at securing credit,” said TransUnion South Africa director of research and consulting Carmen Williams.

“The big question everyone is asking most, is how long the pandemic will last and what will be the impact on the global economy. No crystal ball exists. And people living today have never faced a similar global pandemic with such a far-reaching impact,” said Williams. “The good news is the research demonstrates that people are resilient, and most have figured out a plan for how they will manage their finances until economies re-open and employment opportunities return.”

TransUnion press release extracts, 30 April 2020