Forced to lockdown the whole country to curb the spread of the coronavirus, the Indian government knew what the consequences would be. To date, thousands have died of the deadly coronavirus. Unfortunately, these deaths are not the only casualties of the pandemic. There’s a high number of unemployment in India. To comply with the lockdown directive, businesses had to close down, leading to job losses on a massive scale. As a result, there’s been palpable tension and uncertainty among employees as regards to their job security.
In the midst of all these chaos, however, when it comes to job stability and security, a peculiar phenomenon has emerged. And it has to do with the area where people reside. Data gathered by Max Life Insurance and Kantar, a data and consulting company, showed that people living in urban areas are more anxious about their financial stability and job security than people living in Tier-I or Tier-II areas. Cities with 40 lakh population are classified as metros, while cities with 10-40 lakh and 5-10 lakh of population are classified as tier-I and tier-II cities, respectively. The survey was conducted by collecting data from wealthy digitally-active consumers during the pandemic.
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According to the survey, 70% of respondents living in metros were aware of insurance products compared to 66% living in Tier-I cities. The survey showed that 83% of people living in metros own insurance products against 75% of people living in Tier-I cities. What makes this noteworthy is that the security express level, an estimate which quantifies the level of financial security felt by Indians was at 55% in Tier-1 cities and 46% in metros. In essence, more people living in Tier-1 areas felt financially secure than people in urban areas. The survey involved over 1800 individuals from 25 cities — six metros, nine Tier-I cities, and 10 Tier-II cities, and as much as 77% of the respondents were millennials.
The survey also revealed an increase in the purchase of term insurance among Indians irrespective of where they live. However, at 41%, there was an increase in ownership of term insurance by Indians living in metros compared to Tier-I and II cities. The cause of this increase in term insurance ownership differed across the board, nevertheless. In metros and Tier-I cities, 41% of consumers were triggered by the increase of the spread of the coronavirus and said it’s important to have financial protection (by having a term plan) for self and family. Another 37% were triggered to buy term insurance because they felt life is uncertain. The fact that term plans are cost-effective was another reason for the purchase.
Aside from this, the survey also found that digitally-savvy Indians living in urban areas have changed their lifestyle. As much as 83% of respondents said the situation demands them to be more proactive about financial planning. Another 83% said that home is the only safe place now, while 79% said they do more online shopping now. Further, Tier-I cities are more secure about financial aspects such as fulfilling family needs and financial stability in the event of the untimely death of the breadwinner, child’s education, and fulfilling the family’s luxury needs.
Many urban Indians have their whole lives planned. Yet, these plans center around enjoying the financial stability that comes with job security. The coronavirus pandemic has not only robbed many of this stability, but it has also compromised the employee job and workplace security. For many that have lost their jobs during this period, it is highly uncertain that they will be able to secure employment anytime soon. And if this is the case, anxiety and tension levels are bound to increase.
References:
- People in metros more anxious about income and job security: Survey | Disha Sanghvi | livemint | July 16, 2020
- COVID-19 impact on the unemployment rate in India 2020 | Sandhya Keelery | July 15, 2020
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