Unemployment and Low Savings Driving Greater Sydney “Shadow Pandemic” of Financial Stress

Savvy Survey finds growing financial stress for Sydney-Siders
Published on August 23rd, 2021
  Written by 
Adrian Edlington
Adrian Edlington is PR & Communications Manager at Savvy. With a keen interest in personal finance, car loans, the mortgage industry, cost of living pressures, electric vehicles and renewable technology, Adrian's research includes conducting primary data surveys and analysis of up-to-the-minute secondary Australian data sources. His work on behalf of Savvy has been featured on ABC.net.au The Conversation, the Sydney Morning Herald, AFR, News.com.au, The Age, Herald Sun, Adelaide Now, SBS On The Money, 7News, Car Expert, Which Car, Drive.com.au and more. In his spare time, Adrian enjoys mountain biking and business podcasts.
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   Commentary by 
Bill Tsouvalas

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Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
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Unemployment and low savings - Sydney shadow pandemic of financial stress

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A recent poll conducted by Savvy of 1002 Greater Sydney residents living in COVID-19 lockdown restrictions shows a “shadow pandemic” of financial stress plaguing Greater Sydney, driven by unemployment, underemployment, and rapidly depleting savings – 10% of respondents saying they have $1,000 or less in savings, 9% have $500 or less, while 8% stated they have no savings at all. 

  • 12% of survey respondents have lost employment  
  • 15% “extremely worried” and 12.9% “worried” about losing income if lockdown continues over next three months 
  • 27% have $1,000 or less in savings  
  • 35% are living paycheque to paycheque    
  • 32% pessimistic about finances for remainder of 2021 

12% of respondents reported they have lost employment and 22% said their hours have been reduced.  Of those who are currently employed, 15% said they are “extremely worried”, while 12.9% are “worried” about losing their income if the lockdown continues over the next three months. 

How the pandemic is affecting Sydney resident's work

With the current 2021 NSW pandemic lockdown, please select the scenario most applicable to you?

35% say they are living paycheque to paycheque; cause for concern when extrapolated to the whole of Greater Sydney’s 5.3 million residents. 

Financial wellbeing in terms of savings have faltered, with 46% saying their savings have been reduced, equating to 464 of 1002 total respondents. 19% said they are saving more during the lockdown however, with the highest group surprisingly being in the 18–24-year-old cohort.

29% of respondents said they have at or below one month worth of savings to keep them going; 19% say they have three months’ worth, while 31% say they have six months to a year’s worth saved up.

How the pandemic is affecting people's savings

As for seeking relief, 50% of respondents say that they will seek government support such as Centrelink or the COVID-19 Disaster Payment. 21% said they’re willing to use their credit cards; 12% said they will redraw on home equity. 27% say they will borrow from family.

Savvy Managing Director Bill Tsouvalas says that there may be another “shadow pandemic” of indebtedness and insolvency unless there is more support, financial relief, or an opening up of the economy.

How the pandemic is affecting people's available cash

To what extent do you agree with the following statement: “I currently live pay cheque to pay cheque.”

“As we all know, the longer this goes on and the less income we can all generate through productive work, the more it puts our economy in a precarious position. 29% of respondents, or 293 people, said they could only keep themselves going for another month if they are to become solely reliant on savings. After that, who knows what will happen to these people? Many may fall back on credit cards or even payday loans. A more financially savvy option would be to look for a competitive personal loan with a lower interest rate however.

“All these measures will inevitably make people worse off financially the longer this continues.”

People's worry about losing their income

Worry of losing income chart

41% of respondents said that they do not accept the economic cost of the current NSW Government position of locking down the population to achieve zero community transmission. As of the 20th of August, NSW recorded 646 new COVID-19 cases, resulting in 16,164 active cases in the state.

The Commonwealth Government’s next phase out of “aggressive suppression” is contingent on 70% of the Australian population being fully vaccinated. The current national total is 28.2%, with NSW on 29.3%. Prime Minister Scott Morrison says that this could be achieved by Christmas. With savings running out and employment opportunities dwindling, this leaves two million Sydneysiders with little hope for a financial reprieve. As a result, 32% of respondents are pessimistic about their finances for the remainder of 2021.


How much money do you currently have saved?

“If lockdowns continue without additional support from government or elsewhere, Australians may have no Christmas to look forward to in a financial sense,” Tsouvalas warns. “Something must be done to balance the economic cost with the health benefits of continuing lockdown.” 

Savvy - 2021 Cost of Living Survey - 2 (n = 102) 

Representative survey of 102 adult New South Wales residents in Australia, aged 18 and over. Conducted by Octopus Group, on behalf of Savvy.

Completion date: 12/08/2021

Age groups:18-24, 25-34, 35-44, 45-54, 55-64, 65+

Gender breakdown: male n=46, female n=56, non-binary /prefer not to say n=0

Representative of NSW population:

NSW n=102 (100%)

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