Objectives: The aim of the study was to evaluate whether unemployment and underemployment are associated with mental distress and whether employment insecurity and its mental health consequences are disproportionately concentrated among specific social groups in the United States during the COVID19 pandemic. Study design: This is a population-based longitudinal study. Methods: Data came from the Understanding America Study, a population-based panel in the United States. Between April and May 2020, 3548 adults who were not out of the labor force were surveyed. Analyses using targeted maximum likelihood estimation examined the association of employment insecurity with depression, assessed using the 2-item Patient Health Questionnaire, and anxiety, measured with the 2-item Generalized Anxiety Disorder scale. Stratified models were evaluated to examine whether employment insecurity and its mental health consequences are disproportionately concentrated among specific social groups. Results: Being unemployed or underemployed was associated with increased odds of having depression (adjusted odds ratio [AOR] = 1.66, 95% confidence interval [CI] = 1.36-2.02) and anxiety (AOR = 1.50, 95% CI = 1.26, 1.79), relative to having a full-time job. Employment insecurity was disproportionately concentrated among Hispanics (54.3%), Blacks (60.6%), women (55.9%), young adults (aged 18-29 years; 57.0%), and those without a college degree (62.7%). Furthermore, Hispanic workers, subsequent to employment insecurity, experienced worse effects on depression (AOR = 2.08, 95% CI = 1.28, 3.40) and anxiety (AOR = 1.95, 95% CI = 1.24, 3.09). Those who completed high school or less reported worse depression subsequent to employment insecurity (AOR = 2.44, 95% CI = 1.55, 3.85). Conclusions: Both unemployment and underemployment threaten mental health during the pandemic, and the mental health repercussions are not felt equally across the population. Employment insecurity during the pandemic should be considered an important public health concern that may exacerbate preexisting mental health disparities during and after the pandemic. (c) 2021 The Royal Society for Public Health. Published by Elsevier Ltd. All rights reserved.