Member Article

Chamber reacts to the latest unemployment figures

Business leaders in Coventry and Warwickshire say firms will need further support to keep the unemployment rate down in the next few months, after another small drop in the rate was recorded.

The latest figures show that the unemployment rate dropped from five per cent to 4.9 per cent in the three months to February but that five million people remain in employment but on furlough.

Sean Rose, head of policy at the Coventry and Warwickshire Chamber of Commerce, said the Government must be ready to offer more support to ensure the rate doesn’t jump once the furlough scheme ends.

He said: “The latest unemployment figures show a small drop which is welcome but looking at the data from our most recent QES, there is concern among businesses around employment.

“The really big unknown is what is going to happen when the furlough scheme comes to an end and it’s vitally important that the Government stands ready to help businesses, who have faced the most incredibly difficult year.

“Cutting the costs of employment and helping people to develop new skills fit for the workplace of the future could be vital in keeping the unemployment rate down over the next few months.”

British Chambers of Commerce Head of Economics, Suren Thiru, said: “The latest data confirms that the UK labour market remains subdued. While there was a marginal fall in the unemployment rate, the squeeze on activity from ongoing restrictions helped drive a decline in payroll employment in March.

“Unemployment remains on course to peak towards the end of 2021, once the furlough scheme expires and those who stopped job hunting during the pandemic look to return to the workforce as restrictions ease.

“Although the furlough scheme will limit the peak in job losses, the longer-term structural unemployment caused by Covid-19, particularly among young people, may mean that the road back to pre-pandemic levels lags behind the wider economic recovery.

“Further action will be needed to support the labour market when the furlough scheme ends, including supporting businesses to recruit and retain staff through a temporary cut in employer national insurance contributions.”

This was posted in Bdaily's Members' News section by Matt Joyce .