Workers hit by coronavirus crisis set to plunge into debt in run-up to Christmas

Workers face extra pressure this year because of the Covid-19 pandemic (Image: Getty Images)

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Hard-up workers hit by the coronavirus crisis are set to plunge themselves into debt in the run-up to Christmas, a poll reveals.

A study shows employees in the West Midlands, East Midlands and Greater London are suffering the most with financial-related stress, at 63% of workers, 58% and 66% respectively.

Some 47% in the West Midlands, 46% in Greater London and 43% in the the South West say they need to turn to credit cards, overdrafts or loan firms at least once every three months to make ends meet.

That compares with just 30% in the more affluent South East.

Some 76% of those quizzed believed if they had access to their pay early since the outbreak of Covid-19, it would have stopped them needing to rely on high-cost credit.

Some are turning to credit cards and loans
(Image: PA)

Campaigners said the study boosted calls for bosses to turn to paying staff more flexibly than in fixed monthly packets.

The online survey of 2,005 workers, including some on furlough in the pandemic, was carried out by Sapio Research for financial tech firm Hastee Pay.

Chief executive James Herbert said: “Workers in many regions across the UK have felt the liquidity squeeze during 2020’s challenges, facing higher living costs as well as the after-effects of turning to high-cost credit options.

Financial problems have built up for many during the crisis
(Image: Getty Images/iStockphoto)

“These are causing serious stresses as a result, affecting personal and working lives, and ultimately their financial health.”

He added: “The monthly pay cycle is not fit for purpose and doesn’t allow workers to manage without recourse to damaging credit.

“It needn’t be this way, especially considering that partway through their pay cycles many will have already earned the money to avoid doing so – if only they could access it flexibly.

“Earnings on demand gives employees greater visibility and ownership of their money, and such solutions are often free to the employer, require minimal time and effort to integrate with existing payroll systems and do not impact cash flow.”

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