mid-14c., lousi, "infested with lice," from louse (n.) + -y (2). Figurative use as a generic adjective of abuse dates from late 14c.; sense of "swarming with" (money, etc.) is American English slang from 1843. Related: Lousiness.
parasitic insect infesting human hair and skin, Old English lus, from Proto-Germanic *lus (source also of Old Norse lus, Middle Dutch luus, Dutch luis, Old High German lus, German Laus), from PIE *lus- "louse" (source also of Welsh lleuen "louse").
The meaning "obnoxious person" is from 1630s. The plural lice (Old English lys) shows effects of i-mutation. Grose ["Dictionary of the Vulgar Tongue," 1785] has louse ladder "A stitch fallen in a stocking."
adjective suffix, "full of or characterized by," from Old English -ig, from Proto-Germanic *-iga- (source also of Dutch, Danish, German -ig, Gothic -egs), from PIE -(i)ko-, adjectival suffix, cognate with elements in Greek -ikos, Latin -icus (see -ic). Originally added to nouns in Old English; used from 13c. with verbs, and by 15c. even with other adjectives (for example crispy).
<a href="https://www.etymonline.com/word/lousy">Etymology of lousy by etymonline</a>
Harper, D. (n.d.). Etymology of lousy. Online Etymology Dictionary. Retrieved $(datetime), from https://www.etymonline.com/word/lousy