The coronavirus pandemic resulted in national lockdown orders, followed by employment changes to reduce labor costs. We assess how health varied for hospitality workers due to the lockdown (i.e., comparing health a month before to a month after), employment change (i.e., comparing those with loss vs. no change), and employee response (i.e., more job threat vs. more personal recovery). Comparing pre-and post-lockdown surveys of 137 U.S. and U.K. hospitality employees, psychological health (i.e., negative and positive affect) worsened but physical health (i.e., symptoms and sleep) improved. We proposed those facing work loss (66% had reduced hours, furloughs, or layoffs) had more job threat but also more personal recovery (i.e., relaxation, mastery, exercise), resulting in opposing pathways to health. Results from a path analysis showed that work loss indirectly linked to higher psychological distress due to job threat, but to lower distress and fewer physical symptoms due to relaxation. Regardless of work loss, mastery (e.g., hobbies) was related to immediate changes in positive affect and sleep, while exercise did not have short-term health benefits. Further, recovery benefits from work loss were short-lived; only job threat carried the effect to psychological distress 2 months later. We offer quotes from the hospitality workers to contextualize the blessing and curse of work loss during the lockdown for these particularly vulnerable employees.