Coronavirus (COVID-19) support in low income households: evaluation

Qualitative research evaluating a range of policies and support that were delivered during the COVID-19 pandemic. The research looks at how this support impacted on the finances and wellbeing of low income households.

6. Employment

This chapter looks at employment related issues, including how participants' work status or patterns changed, experiences of being furloughed, working at home or outside the home, or being self-employed or running a small business. It also sets out participants' suggestions about what might have been done differently to support those in employment during the pandemic.

It draws on the experiences of the 32 participants in full-time or part-time work at the point of interview, as well as five participants who had lost work during the pandemic months and who remained out of work when they were interviewed for the study.

Key findings

  • Participants who had been furloughed felt the scheme had worked for them, even though some had not had their salary topped up by their employer.
  • Loss of employment, rather than furlough, had the greatest impact on income levels of those interviewed and could move a household from experiencing moderate financial hardship, or even being just above the low income threshold, straight into severe financial hardship.
  • Income levels generally remained the same for those who had worked outside the home for all or much of the pandemic, including the key workers who worked through lockdowns.
  • Participants identified particular challenges associated with being a key worker, including around the risk of bringing COVID into their home.
  • Working from home had its challenges, but those able to do this also appreciated its advantages. This included in terms of juggling work and childcare.
  • The self-employed and small business owners were sometimes those in the greatest financial difficulty, either because they did not understand their entitlements and/or they had difficulty in accessing them. Participants with limited English were particularly vulnerable. Some would have benefitted from having easier access to information that met their particular needs.
  • Low income key workers would have welcomed some financial support, including to cover the additional costs they sometimes incurred.

COVID-related changes and challenges


Those who had been furloughed for some of the pandemic had generally found the approach had worked well for them, particularly when their employer had topped up their wages.

There was a bit of uncertainty for the first few weeks ... we didn't know what was happening, [name of employer] didn't know what was happening. The first month was ... are we going to get paid at all ... but then he said he'd sorted it all and he was going to get us our wages at 100%. He was really good, really supportive.

Lone parent with one child.
Urban area with substantial rural areas.

Those who had been furloughed generally managed, but those that only received 80% of wages said they had sometimes had to cut back on some of their usual expenditure. For example, there were references to cancelling entertainment subscriptions or moving to cheaper brands of food. Saving on work-related costs, such as travel costs and buying lunches while at work, had also helped them manage.

Loss of employment

As expected, those losing paid work generally experienced the most significant reductions in household incomes. This applied particularly if they had lost full-time work, but could also be significant if part-time work was lost:

  • Losing full-time work could move a household from experiencing moderate financial hardship, or even being just above the low income threshold, straight into severe financial hardship
  • Losing part-time work could move a household from being in serious into severe financial hardship
  • A reduction in working hours from full to part-time could move a household from being in moderate financial hardship to being closer to, or in, serious financial hardship
  • Those already working part-time and then having hours cut generally appeared to have remained in serious financial hardship, albeit they moved closer to the severe financial hardship threshold.

Job losses, along with reduction in working hours, were associated particularly with working in hospitality, tourism and non-food related retail. Some participants were made redundant immediately before the launch of the furlough scheme.

That day was really stressful, I remember the Friday before lockdown hit, this is two days after being laid off, there was an announcement on telly about the furlough scheme, and I just broke down in tears.

Lone parent with one child.
Urban with substantial rural areas.

Others had lost employment at some point from the first lockdown through to during the winter of 2020/21.

In addition to losing work altogether, some participants have been on reduced working hours. This tended to be associated with participants who had previously worked on casual or zero-hours contracts, primarily in hospitality or cleaning jobs. In these cases, participants said that the lost hours have now generally returned.

There were also a small number of examples of participants working for third sector organisations who remain on reduced hours because of funding issues within their organisations.

Although most of those who had been furloughed have now returned to work, others had lost their job.

I was furloughed to start with but then they got rid ... I'm not sure I would have been able to work anyway ... it was shifts and without my mum or their dad having the kids ... and I think that would have been too much ... for me and the kids.

Young lone parent, two children.
Urban area with substantial rural areas.

Key workers and working outside the home

Income levels generally remained the same for those who had worked outside the home for all or much of the pandemic, and especially the key workers who worked through lockdowns. In some cases this meant they remained in moderate financial hardship, for others they remained in serious financial hardship.

However, participants did speak of particular challenges associated with being a key worker in moderate or serious financial hardship. These included that:

  • The type of work being done, including working in supermarkets or cleaning roles, may not have seemed to be high risk relative to some other roles. Nevertheless, it did expose people to a greater risk of catching COVID. This led to significant additional pressure on key workers and also on their families. Participants sometimes felt that the type of role they were fulfilling was not respected or recognised

... yeah, to be honest there were times, I love my job usually, but I thought why am I out doing this for not much more than £9 an hour? We were all stressed but some of the ways people behaved ... there was one day, some of us were just standing there in the middle of the shop thinking, none of this is our fault, I could be at home with my kids ...

Lone parent with two children.
Mainly rural area.

  • For some there were additional costs, including travel costs, particularly during the first lockdown. Participants also incurred additional laundry costs associated with daily washing of uniforms

There just were no buses at times here especially at the start. Sometimes I walked it but it's nearly an hour ... I didn't mind for getting there but at the end of a shift ... and my mum completely freaked about the dark ... so sometimes I did book taxis once you could, but both ways ... I thought this is crazy money when I don't earn that much anyway.

Urban area.

One other issue raised was that some key workers may have received very little additional income as a result of any bonuses/special recognition payments that were made. For example, a lone parent working full-time in retail, who earned around the 2020 Scottish Living Wage and was in receipt of Universal Credit, reported that the basis on which Universal Credit is calculated meant that they had netted less from the £500 gross bonus their employer paid than colleagues who worked part-time, had another full-time wage going into their household, and were not entitled to Universal Credit.

Working from home

Those who began working from home during the first lockdown, including some who continue to work from home, were among those who felt they had fared best during the pandemic. These participants were generally in the moderate financial hardship group.

It was not that they had not experienced difficulties, but they tended to reflect that they had been among the lucky ones, especially if they had been able to work flexible hours to juggle childcare commitments.

... there have been some upsides to it, like convenience, obviously I was here for the children, so I could do my job while they were here, I didn't need to worry about childcare, but the thing is my office is technically a cupboard ... and there isn't an alternative place I can work from in the house that's convenient.

Couple with three children.
Urban area.

Self-employed and small business owners

Participants who are self-employed or who run small businesses were among those reporting the greatest difficulties. Depending on the sector in which they work, there have sometimes been prolonged periods of being unable to earn. The impact of not earning appeared to be to move these households from either the moderate or serious financial hardship groups into the severe financial hardship group.

My husband was self-employed ... he was a painter and decorator, so he couldn't work, he wasn't allowed in anybody's house. That kind of left us in a position of, so how are we going to pay our bills, our rent and all that sort of stuff? ... it still has effects now, because you are still trying to get back from day one of the pandemic.

Couple with one child.

Mainly rural area.

There were mixed reports in terms of how participants had managed financially. Some had accessed advice and support, but others had struggled. Those who struggled were often not aware of the Self-Employment Income Support Scheme or the small business support that was available. There were also instances when a participant was ineligible for the Self-Employment Income Support Scheme because they had not been self-employed for long enough.[11]

There was also sometimes reluctance to either apply for Universal Credit or to update an existing claim. Reasons given included that:

  • They had assumed the impact of COVID on their business would be relatively short-lived and preferred to 'hold on' and weather out the storm. There were references to possibly having acted differently if they had known how long their income might be affected
  • They were worried that any reassessment of entitlements could lead to gaps in payments or a reduction in the amount they were entitled to in the longer term. This appeared to be connected to concerns about moving from the Working Tax Credit regime to Universal Credit.

The self-employed and small business group also included participants with limited English proficiency who had struggled to find out about the available range of support. This included an instance of a participant struggling to access information and advice in their first language, leading on to them applying inadvertently for a small business loan when they had thought they were applying for a grant.

Other particular challenges that participants with limited English reported included that they:

  • May also have limited ICT skills or limited ICT resources and have struggled to move their business online when others have been doing so
  • Did not think they had other likely job options if their small business folds.

What could have been done differently

Participants were asked whether they had any suggestions about how their employment-related needs might have been better met during the pandemic.

Information on self-employment or small businesses: The self-employed and those running small businesses needed to actively access information and advice but sometimes struggled. There were particular issues for participants running small businesses who have limited English.

Resources for low income key workers: Key workers may have incurred additional costs related to going to work, especially during the first lockdown. These included travel and laundry costs. For those on lower incomes, some recognition of and/or support to cover these costs would have been welcomed. If recognition payments/bonuses were paid, participants would have appreciated receiving all or the bulk of those payments, rather than missing out on a significant proportion because of their overall household income.

Looking forward

Overall, those who had been in and retained work felt positive about their work prospects. They generally felt their job was secure. In some cases, participants had taken on more hours within an existing job or a second job. However, a small number of participants – primarily working in the third sector – were concerned that their posts could still go, or that they were likely to continue on reduced hours for the foreseeable future.

Perhaps the biggest concern for those working was whether their current income, and especially the hourly rate at which they are paid, will increase in pace with their rising costs. This was associated with cost increases relating to food, other household essentials and energy, and how they may be affected by the recent changes to Universal Credit tapers. Combined with the loss of the Universal Credit uplift, participants generally expected to be worse off in the short to medium term.

Participants running small businesses, or who were self-employed, tended to be feeling less optimistic and/or to feel that it would take them longer to recover financially from the impact of COVID. This included because pre-pandemic financial reserves had been used up or because of the requirement to repay any COVID support-related loans. In a small number of cases, participants were very concerned that their small business or self-employed status may not be sustainable going forward.

Those looking for work were also generally concerned about the future. Participants spoke of hearing that employers were desperately looking for staff but that they were struggling to find work locally. There were also concerns that much of the work available locally was in the hospitality sector or other sectors that require evening and/or weekend work. Juggling these shift patterns with childcare commitments was sometimes felt to be unworkable.

Case studies

The case studies that follow pick up on a number of the key themes set out in this chapter.

The Porter Family's story reflects on the pressures of being a key worker during the pandemic, and especially on the challenges of being a lower paid key worker during lockdown.

The Qureshi Family's story looks at the difficulties faced when running a small business during the pandemic, along with the particular challenges people could face getting advice and information if they have limited English. It also considers some of the pressures small business owners may face going forward.

The Porter family

Alison and her two children live on the outskirts of a Tayside town. She rents her three-bedroom home from a private landlord and works full-time in a supermarket. She has worked there for around six years ago and has always loved her job. The family is eligible for Universal Credit and although there's not much to spare, they manage fine.

Her father lives in a nearby village. On the day the first lockdown was announced, he packed his bag and moved in with his daughter and the grandchildren. He didn't want to be on his own, and he knew that Alison was likely to need some help with the children.

Alison worked from day one of the first lockdown. She felt it was important to go in, and as one of the more experienced members of staff she was really needed. With her father staying, her childcare was covered, and she knew enough about her colleagues' home lives to know that some of them would struggle.

There have been times when it's been incredibly tough. The first lockdown was the hardest – lots of customers were stressed and they sometimes took that out on staff. She has known some of her older regulars for years and when the shelves were empty, it could be heart-breaking.

Although she felt it was important to go into work, she also worried about her family's safety. Whenever she went home, she went straight in the shower, cleaned the bathroom and put her uniform and the towels straight in the wash. It was both tiring and costly, especially if she was working a split shift and went through the whole process twice in one day.

While she was worrying about her family, they were worrying about her. During the first couple of months, the bus service was really erratic, and she took to walking in. What was usually a 15-minute journey took her about 40 minutes to walk and she was getting increasingly tired. She got a taxi once that became an option, but the costs really mounted up. The bus service did improve, but she only really felt comfortable using buses once she had her first vaccination.

She did get the Universal Credit top up, but otherwise they haven't really had any extra help and with food and energy costs at home, and with taxi fares, they've ended up a little worse off. She can cope with that, but she was sad for the children when some of their friends were given new tablets, but they weren't. They have laptops that work fine, but she did think it would have been a nice gesture.

Alison certainly doesn't regret working through the pandemic, but she does feel that there could have been a little more help for key workers on a low income. Even getting to keep a bit more of the two special recognition bonuses she received from her employer would have been something.

The Qureshi Family

Ameena and her husband Khawar have lived in Scotland for around 11 years. They have two boys, aged 7 and 3 years old. The Qureshi family moved to Aberdeen around five years ago and Khawar set up a small catering supplies company. He works long hours, and his health is not good. Ameena would prefer her husband stopped working, but he wants to provide for his family and was hoping to build something to pass on to the children when the time came.

Their family income is supplemented by Universal Credit, and prior to COVID Ameena felt they were doing reasonably well. Money was sometimes tight, but they managed the basics, and her budgeting skills are good. They live in a housing association flat, and the rent and bills are reasonable.

During the first lockdown, the business was affected very badly. They had to let their part-time member of staff go, and there were times when they could take no money out of the business for a number of weeks. They did contact the Department of Work and Pensions and their standard payments have increased by a small amount, and they have also been receiving the Universal Credit top up.

By the late winter of 2020/21, they agreed that the business needed help if it was to survive. Ameena asked around, but the organisations she would normally go to, like the housing association, suggested she should contact the Council because the issue related to a small business. They can both struggle with English over the phone and she would normally make calls of this type. She tried a couple of times but was struggling to get through. In any case, she was worried she would misunderstand and that would cause them further problems.

They tried at looking at various options online but struggled with the explanations of what was available and how to apply. They couldn't think how else to get support, so asked a cousin to help them complete an online application. They thought they were applying for a small business grant but actually applied for a loan.

The business has not really bounced back, especially as Khawar's health has deteriorated. Ameena is very worried about how they will repay the loan. They are very reluctant to close the business as they cannot see any other employment options for Khawar, and he really wants to work. However, Ameena doesn't think the business is likely to recover if they can't start taking online orders. They have no idea how to go about doing that, but she is going to look around to see if she can find someone to help.

They are now behind with their electricity and gas bills and there is no money left after food and a few other necessities are covered. Ameena hates having to say no to the children all the time, but at the moment there is no money for even the occasional treat. She worries about her husband's health and any prospect of a visit to see her parents, who have never met their grandchildren, is now gone.



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