COVID-19 Impacting Consumer Finances Similarly Around the World with Millennials Facing the Greatest Challenge; In Hong Kong three in four concerned with paying bills and loans

The COVID-19 pandemic is causing similar financial challenges for consumers around the world, but new research indicates that Millennials (those aged 26-40) are being challenged the most. A newly-released TransUnion (NYSE: TRU) global report found that three in four Millennials (76%) worldwide, and a similar number in Hong Kong (74%) indicated their household incomes have been negatively impacted by the pandemic. This compares to 64% of all other generations globally and 71% for all other generations in Hong Kong.

In the weeks since the World Health Organization (WHO) declared the coronavirus (COVID-19) a pandemic on March 11, TransUnion has polled thousands of consumers in Hong Kong, Canada, Colombia, India, South Africa, the U.K., and the U.S. to determine the impact of the pandemic on their finances. Research for the global report was conducted in mid-April and observed how COVID-19 has impacted millions of global consumers differently based on employer size, generational differences, government interventions and income dynamics.

“COVID-19 has brought about unprecedented financial challenges to people and businesses in Hong Kong and around the globe,” said Claire Lim, Chief Executive Officer of TransUnion Hong Kong. “It’s important that we all have a good understanding of the situation in our market because our ability to eventually recover from this global pandemic is as much about understanding the financial impacts of this crisis as the physical ones.”

A clear outcome from the research is that many consumers are feeling financial pain, but the Millennial generation is under the most stress. Globally, 22% of Millennials with household incomes negatively impacted (19% in Hong Kong) have lost their job due to COVID-19 compared to 16% for all other generations (17% in Hong Kong). Just under half (45%) of Millennials with incomes negatively impacted (58% for Hong Kong) have seen their work hours reduced compared to 35% for the rest of the group (54% for Hong Kong).

Millennials Facing Greatest Challenge from COVID-19 Pandemic

*World composite includes Hong Kong, U.S., Canada, Colombia, India, South Africa and U.K. 
Source: TransUnion Global COVID-19 Consumer Financial Hardship Study Report

This pressure is compounded by the fact that globally, 61% of Millennials said they have dependent children living at home – a much greater rate than the 39% noted for other generations. In Hong Kong, 46% of Millennials in the survey have dependent children living at home compared to 37% 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. In Hong Kong, 70% of impacted Millennials are unable to pay for rent or mortgage compared to 57% for other generations. In this group in Hong Kong, 45% also expected they would have difficulty paying their bills and loans in around one to three months’ time.

“Millennials are the first generation to be fully immersed in mass-market digitalization and are savvy at securing credit,” said Francis Lau, director of research and consulting at TransUnion Hong Kong. “While Gen Z can say the same, the big difference is that many Millennials are more settled in their careers and are beginning to approach the peak earning period of their lives.”

Where do we go from here?

While the global report makes it clear that consumers are struggling financially, the research suggests that they are coping relatively well. For instance, five in six (85%) global respondents said they have a plan to deal with their financial gap regardless of generation. In the Hong Kong an even higher percentage (94%) said they have a plan.

“The big question most everyone is asking 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 Lau. “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.”

Additional details about the report as well as resources for consumers looking to minimize the potential negative impact of the pandemic on their credit can be found on TransUnion’s COVID-19 website. Businesses interested in learning how to navigate the impacts of COVID-19 can gain insights from TransUnion webinars, blogs and more here.

About the Global Report

TransUnion surveyed 9,215 consumers in Hong Kong, Canada, Colombia, India, South Africa, the U.K., and the U.S. during the week of April 13. In addition to generational information, the global report provides insight on the impact of the financial hardship caused by the COVID-19 pandemic on other key factors such as employer size, income dynamics and government interventions. This report is part of TransUnion’s effort to make trust possible between businesses and consumers by providing information and insights so that people can transact confidently.