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How to Get Underemployment Benefits to Offset Income Lost Due to COVID-19

The coronavirus pandemic has left millions of Americans without a job or at risk of being underemployed. According to the Department of Labor, more than 5.2 million workers filed for unemployment benefits for the first time during the week of April 5-11.

If you’ve experienced a drop in income or hours, it can be challenging to find financial help, especially since you aren’t considered “unemployed.”

But there are programs available to help ease your financial burden and keep you afloat during this difficult period.

Professions that have been hit the hardest by the pandemic

Student Loan Planner®’s March 2020 COVID-19 survey of more than 4,000 readers sought to find out how the pandemic has affected their income and financial practices.

We then surveyed that same group of readers in April to see how their circumstances had changed over 30 days. We found that several professions have taken the brunt of this health and financial crisis.

The dental profession has been severely affected by the coronavirus. Most states don’t consider dental professionals to be “essential workers,” so offices have closed down across the country, with many dental professionals taking a pay cut or losing their income altogether.

Our data showed that 56% of surveyed dentists had a total loss of income by April 2020.

But other professions have also been hit hard by this pandemic too:

  • 46% of surveyed optometrists have completely lost their income. And an additional 37% of optometrists’ income levels fell by April.
  • 63% of acupuncturists and restaurant staff saw a complete loss of income.

Some doctors and medical staff are experiencing a significant drop in their incomes, as well. The decision to postpone elective surgeries and outpatient services has caused a loss of revenue for many medical employers. For example, the Mayo Clinic is projecting a $3 billion loss this year, resulting in across-the-board pay reductions and furloughs.

Financial assistance for workers with lost wages due to the coronavirus

According to our April survey, approximately 40% of our readers either lost their income or have seen a reduction in wages because of the coronavirus. This is a significant increase from the 29% that reported a change in income during our March survey.

If you’re one of these now underemployed workers, the financial pressure can be overwhelming. Here are some resources that underemployed workers should explore.

How to get underemployment benefits

States now have more flexibility for providing expanded unemployment benefits. This expansion is meant to provide coverage for more people who have been affected by this pandemic. And thanks to the passage of the CARES Act, self-employed individuals may now also be eligible if their workload has dropped off.

Our survey showed that approximately 9% of Student Loan Planner® readers are receiving unemployment benefits. But the vast majority of respondents believe their current earning situation is only temporary, with only 3% responding that they were potentially permanently laid off.

If you’ve lost wages or had your hours reduced due to COVID-19 and coronavirus-related closures or disruptions in your industry, you may qualify to file for underemployment benefits in your state.

Eligibility requirements and awarded amounts for underemployment benefits vary by state. But previous requirements may have been waived due to the current economic crisis, which means you may qualify now even if you haven’t in the past.

Explore your state’s unemployment policies to determine what benefits are available given your situation.

Creditor financial relief programs

Contact each of your creditors or loan servicers to discuss available relief programs. Although some of these programs are available year-round, temporary policies may have been put in place to help people to help minimize the impact of the coronavirus outbreak.

For example, many credit card companies are offering to temporarily lower interest rates or postpone payments, but you have to initiate these financial relief efforts.

When speaking with your creditors, be sure to communicate your inability to pay is a direct result of the coronavirus. And be ready to provide an estimate of how much you can afford to pay during this stressful time.

Available COVID-19 financial relief resources by profession

There are many resources you can tap into outside of unemployment or underemployment assistance. Organizations across the country are pooling resources to support those who need it most.

Here are some resources broken down by profession:

An extensive list of grants and other emergency financial resources has been put together by GrantSpace.

Be sure to thoroughly review these websites for information related to financial relief and other profession-specific resources.

Other resources for underemployed workers

If you’re struggling to make ends meet because of coronavirus-related closures and disruptions, the following resources can connect you with local opportunities for assistance:

  • United Way (211). Dial 2-1-1 to speak with a United Way representative. They can provide assistance with finding food, paying bills or accessing other essential services. You can also use its online tool for a list of available resources in your area.
  • Local workforce system. These programs and services are designed to help you find new employment or training opportunities. The CareerOneStop website provides job-related resources that can help you find temporary employment or a new career, if needed.

The impact of COVID-19 on personal and professional lives isn’t something anyone planned for. Fortunately, new programs are popping up every day to help individuals and small businesses through this unprecedented time.

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