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It may take Americans up to five years to recover from the hit their wages will take during the coronavirus pandemic, according to an analysis by Payscale.
Blue-collar and small-business workers are feeling the biggest impact, said Sudarshan Sampath, director of research for PayScale, a compensation software and data company.
“A lot of folks working for small businesses are probably going to experience something very similar to 2008, where they are losing everything,” he said. “It will take four to five years for them to recover.”
Mid-size businesses may see a two- to three-year wage recovery period, he added.
However, major companies that are not suffering from big layoffs may be fine — and may even see an expansion if the economy recovers. For example, Salesforce promised it would have “no significant” layoffs over the next three months.
“That is really going to exacerbate inequality” within our society, Sampath said.
The pandemic has caused businesses to shutter and workers to lose or be furloughed from their jobs. About 10 million Americans have filed for unemployment insurance over the past two weeks. The biggest groups looking for work are bartenders, athletic coaches and wait staff, according to CareerBuilder.
“The economy has never experienced anything like this,” Sampath noted. “You expect it to take up to a year to get the amount of job losses we are experiencing.”
The Q1 2020 Payscale Index, which tracks quarterly and annual trends in compensation, found that wages in sales jobs and the energy and utility sectors saw the least growth last quarter.
Transportation, on the other hand, topped the list, thanks to the increase in demand for delivered goods from the many people working from home. First-quarter wages grew 3.2% over the past year.
Sampath said that boost largely came from Seattle and San Francisco, two of the earliest cities to start social distancing practices. As more and more Americans start to work from home, he expects deliveries to increase.
“Even in a recession, there are winners and losers,” he said.
“In this case, I imagine we will see a huge spike in transportation and warehouse wages just because there will be a lot of demand.”
The speed of the recovery is contingent upon the containment of the virus, said Sampath. He’s keeping an eye on New York, since so many goods and services come through the area.
“In the next few weeks, if we see cases and hospitalizations go down, I would feel good about saying for larger firms it is going to be business as usual come [the third quarter],” he said.
—CNBC’s Jeff Cox contributed to this report.
Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.