Pandemics don’t just affect our health – they rip through our economies, too. For many people affected by the coronavirus, including those who don’t fall sick, economic survival will be a primary concern. When businesses close and workers no longer get paid, the bills for unpaid rents, mortgages and consumer loans quickly accumulate. Cities have already shut down swaths of their transport services, shops, cafes and cinemas. Mass lay-offs are on the horizon. Unemployment insurance will cover some, at least for a time. But self-employed and temporary workers, and households that live pay-cheque to pay-cheque, don’t have such buffers.
If you have some savings and only a little debt, the situation is tricky enough. But since the debt-fuelled financial crisis in 2008, household debt has grown. In the UK, total household debt stood at £1.28 trillion for the period from April 2016 to March 2018 according to the Office of National Statistics (ONS).