ONS employment statistics: Experts say future looks "decidedly grim"
The number of people on payrolls in the UK has fallen by more than 600,000 during the last three months.
The Office for National Statistics (ONS) reported today that lockdown had a 600,000-strong hit on employment, seeing claims for work-related benefits rise by 23 per cent last month.
However, the organisation warns that the fall could continue past lockdown, as furlough schemes protecting jobs begin to be lifted.
The office also reported a record drop in weekly hours worked, dropping by 94.2 million - 9 per cent - to 959.9 million.
There was another record drop in the period, with job vacancies dipping by 476,000 from the last quarter.
Jonathan Athow, deputy national statistician for economic statistics at ONS, commented: “The slowdown in the economy is now visibly hitting the labour market, especially in terms of hours worked.
“Early indicators for May show that the number of employees on payrolls were down over 600,000 compared with March.”
Experts and analysts from across the country commented on the impact of these figures and what the picture might look like going forward.
Chris Locke, Rainmaking
“We will only start to get a true picture of unemployment rates when the government furlough scheme ends in October.
“For those corporates that know these workers have no jobs to return to, the onus is on them to be thinking proactively about what they do to avoid letting their talent go into a jobless market.
“The UK needs options that will fuel economic recovery and enhance corporate confidence.
“Our recent YouGov research of over 100+ UK enterprises C-suite level executives found that 17 per cent are already implementing cost-cutting measures, including redundancy, due to the pressures of Covid-19 - this number will undoubtedly increase as they lose cashflow and runway.
“By helping to kick start the next wave of startups across the UK, corporates can help the UK economy bounce back faster, help drive new growth in jobs and reduce the impact in local communities.”
Jonathan Walker, North East England Chamber of Commerce
“The headline labour force statistics show that the regional economy was still in job creation mode right up to point when Covid-19 hit.
“These numbers do not yet fully show how severe the impact of the current crisis has been on our labour market.
“Government support such as the furlough scheme has helped to stave off many major job losses for the time being, but the fact that May’s claimant count is 77 per cent higher than this time last year shows the scale of the challenge we are likely to face.
“The North East continues to have the highest unemployment rate in the country.
“We know this crisis and any recession will be felt more strongly in regions such as ours.
“The promise of levelling up that brought the government to power must be honoured in any economic recovery plans.”
Lorna Davidson, Redwigwam
“The world of work is going to change dramatically over the coming months as we emerge from lockdown.
“Businesses will want to dial up and dial down their workforces subject to need using flexible workers.
“We have already seen a surge in the number of people registering on our [flexible working] platform and the number of employers choosing to use us to find the flexible workers that they require.
We currently have over 130,000 workers and 3,500 companies on our system.
“Over 5 million talented people already choose to work flexibly, a number that we expect to rise exponentially as the UK recovers from the devastating effects of Covid-19.”
Sarah Coles, Hargreaves Lansdown
“The future looks decidedly grim. Job losses are being held back to some extent by the furlough scheme, but we’re already seeing tell-tale signs of the horrors that could be on their way when the scheme is withdrawn.
“It’s no wonder that more than half of us are worried about the future, and a fifth are considering moving into a more secure career.
“Even if you’re lucky enough to keep your job, there’s every chance you could see your pay stall, which could cause serious issues if you’ve been making plans based on a pay rise.
“Whatever the future holds, it can help enormously if you’ve planned for the worst case.
“We should all have emergency savings of 3-6 months’ worth of expenses we can fall back on.
“It’s also worth looking into the help that might be available from the state, and updating your CV just in case.
“Nobody wants to think too much about a worrying future, but the more you do so now, the more you can prepare for whatever the future holds.”
Luke Davis, CEO of IW Capital
“While the government’s furlough scheme has helped to sustain employment during the lockdown period, there are signs of turbulence ahead.
“The small business community and the support it receives is absolutely crucial in ensuring that workers are in employment, allowing the economy to recover and grow and reducing the reliant on state subsidies.
“With an economic contribution of over £2trillion, the success of the UK economy as a whole may in future hinge on the prosperity of SMEs, start-ups and high-growth firms.
“There are a fantastic range of innovative, growing SMEs that we work with which are likely to drive our private sector forward in the coming years and employ some of the finest talents in the market today.
“There are a few ways that the government could encourage growth in SMEs to aid employment.”
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