Denverites weathered pandemic better financially, but are less optimistic about future

Denver-area residents are reporting a higher level of financial resiliency coming out of the pandemic, but workers of color are less optimistic here about their career prospects going forward than in the country as a whole, according to the first McKinsey American Opportunity Survey.

“If you had a higher wage you are more likely to see income go up. If you had lower income, you were likely to see it go down,” said Kweilin Ellingrud, a senior partner at the consulting firm McKinsey & Co. and a co-author of a report based on a survey earlier this spring of 25,109 U.S. adults, including about 1,000 people in metro Denver.

An annual income of $50,000 is the dividing line between those who weathered the downturn the best and are most hopeful about the future and those who took the hardest hit and are least optimistic, Ellingrud said. About three out of 10 households cut back on food or health care expenditures during the pandemic because of costs.

McKinsey estimates the COVID-19 pandemic will end up blowing a $16 trillion hole in the global economy, but it wanted to drill down and find out what economic hit individuals took, their view of opportunities going forward, and the barriers they face.

Nationally, half of the people surveyed described themselves in a financially precarious position, defined as being unable to survive more than two months without a job or outside support. Denver did better on that measure, with 54% of respondents saying they could last more than two months off the reserves they had built up.

About 29% of Denver-area residents reported earning less income now than they did before the pandemic, and a similar share took on more debt to get through the downturn. The survey found Denver’s Hispanic respondents were hit harder, with 38% reporting a loss of income, above the U.S. average of 34%.

First-generation immigrants in Denver were also much more likely to take on increased debt, 45% in Denver versus 35% nationally.

Ellingrud said the U.S. economy is mostly recovered from a GDP perspective, but that restoring jobs could take until 2023. For those who didn’t complete college, the job recovery could stretch out for three to five years.

The pandemic only deepened pre-existing inequality and disparities, the survey found, and large shares of respondents reported that some aspect of their identity — race, gender, age or sexual orientation — was hampering their career prospects.

In metro Denver, for reasons that aren’t entirely clear, minority workers were more likely to report a perception of career blockage.

Among Black respondents in Denver, 57% said their race was hampering their future job prospects versus 40% nationally. Among Asian American respondents in Denver, 37% believed that was the case versus 32% nationally.

Denver had the worst ratio of perceived career blockage among its Latino residents of any big city, and about three in 10 women and a similar ratio of gay, lesbian or bisexual respondents in Denver believed their job prospects were impacted by gender or sexual orientation, respectively.

But of all the groups surveyed, none felt as discriminated against in Denver or nationally as workers aged 55 to 64. Seven in 10 said ageism has negatively impacted their future job prospects.

Only half of Denver respondents believed that most people had opportunities to find good jobs, and only a third felt that most people receive a level of pay that allowed them to maintain a good quality of life.

Despite the perception that gig and temporary workers don’t want to be locked down, more than six in 10 in Denver said they would jump into a permanent position if the right one became available. And a large share of them said they were pursuing training and gaining new skills to that end.

More than one in four women nationally said they are considering leaving the workplace or downshifting their careers as a result of the pandemic, and McKinsey recommends communities make the issues of accessible child care a priority or risk underperforming economically. Denver-area women, the survey found, were less likely to report issues with child care.

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