One million still furloughed as government support scheme closes

Rishi Sunak: There are no plans to extend furlough

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Around 1.7 million jobs were still being supported by the scheme in late July and as the rate at which people are coming off it is stalling, 900,000 people may still be on furlough at the end of September. Resolution said the labour market “remains far from full health”.

The think tank warned that although the majority will return to work, up to 150,000 may end up losing their jobs.

With the numbers starting new jobs at record highs and set to hit two million for the first time ever this autumn, Resolution fears businesses will not have the capacity to absorb all furloughed staff that lose their jobs.

Resolution economist Hannah Slaughter said: “The scheme has protected 11 million jobs and prevented an unemployment catastrophe, but with the scheme ending soon there is huge uncertainty about what will happen next to the jobs market.

“As many as 900,000 workers could be on the scheme when it closes, though the majority are likely to return to their jobs. With firms already reporting ‘hiring bottlenecks’, even a fresh surge in job starts is unlikely to be enough to prevent unemployment rising this autumn.”

Resolution said that given the uncertainty, the Government should keep job support schemes to protect vulnerable groups, such as Restart, which is aimed at older workers. 

It said older workers are the most likely to be on furlough, as well as the most likely to have been on the scheme for at least six months.

It should also keep measures such as the £20 a week uplift to Universal Credit as a safety net for those losing jobs. 

Slaughter said: “Cutting support while unemployment is rising is bad politics, bad economics, and bad for living standards.”

Rishi Sunak

Rishi Sunak introduced the furlough scheme in March 2020 (Image: Getty)

Harry Byrne

Harry Byrne

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