Wage reductions and job losses could hit the incomes of younger workers for years to come, a report from think-tank the Resolution Foundation warns.
But they are not the only group facing a potentially permanent reduction in earnings, with older workers looking at risk too.
Resolution Foundation researcher Maja Gustafsson said: “Our research confirms fears that young people are being hardest in the current crisis.
"One in three young people have been furloughed or lost their jobs completely, and over one in three had had their pay reduced since the crisis started."
The Foundation said employees across all age groups are more likely to be earning less than they did in January than earning more, though young and older workers are most affected.
Among 18 to 24-year-olds, 35% are earning less than they did before the outbreak, and 13% are earning more.
Employees in their early 60s are the next most likely to be receiving less pay (30%), with a further 9% receiving more pay.
The big concern is that things simply won't return to normal after lockdown ends - with companies going bust and an overall reduction in jobs and the economy possible.
"Younger workers deeply affected by the crisis today risk have their pay scarred for years to come – causing a long-term reduction in their living standards," the Resolution Foundation warned.
Young people are also the most likely to have lost work, the research suggests.
Around one in three 18 to 24-year-old employees have lost work, either through being furloughed (23%) or losing their jobs completely (9%).
A fifth (20%) of employees in their late 20s (aged 25 to 29) have either been furloughed or lost their jobs, along with nearly a fifth (18%) of workers in their early 60s (aged 60 to 64).
There is also a risk older workers will lose out permanently too if they are involuntary retired before they can start receiving the state pension or don't have time to make up their current earnings shortfall.
The foundation, whose work focused on improving the living standards of those on low to middle incomes, said the Government needs to start preparing its response to the next phase of the crisis, which should include broader measures to boost demand in the economy and raise household incomes.
Gustafsson said: "While young people are in the eye of the storm, they are not the only group who are experiencing big income shocks.
"Britain is experiencing a U-shaped living standards crisis, with workers in their early 60s also badly affected.
"That is why the Government's strategy to support the recovery should combine targeted support to help young people into work, with more general stimulus to boost demand across the economy and help households of all ages."
