The UK's labour market is struggling to recover as 695,000 jobs been lost since the onset of the Coronavirus pandemic, including a further 5 million people still temporarily away from work, despite the hospitality sector reopening back in July, according to a recent report.
Recession Covid 2020
This number comes from the sheer volume of people who have been shed from company payrolls as the British labour market struggles to return to normal in the wake of the crisis, official data from the Office of National Statistics (ONS) has shown.
The data suggests that jobs looking for fresh hires as people begin to go back to work hasn't been enough to offset the number of jobs lost or furloughed over the course of the lockdown.
The figures show that roughly two million people returned to work after the furlough scheme ended in July, which led to a small resurgence in average weekly wages, being only 0.1% lower than for the same period last year, but at the cost of a much steeper decline in the months prior.
Nye Cominetti, an economist at the Resolution Foundation think-tank, said: “The reopening of the economy this summer after lockdown may have boosted economic activity, but it has not spurred a recovery in the jobs market."
Some people who had become unemployed over the course of the pandemic have been shown to have returned to the labour market, with only a 0.3% drop in this field from the same time last year, matching its previous record low.
The ONS estimated that more than five million people were still away from work by July, with many having been off work for longer than three months.
The data suggests that hiring figures have resurged since July, but are still crawling at 40% below pre-pandemic levels.
In contrast, the number of redundancies has reached record heights since the fallout of the 2008 financial crisis, up by 58,000 on the year and 48,000 on the quarter, pushing the unemployment rate up to 4.1%, matching predictions made by the ONS's analysts.
Unemployment is only up by 0.1% on the previous quarter, with a modest 0.4% climb on the same time last year.
However, young people account for the sharpest rise in unemployment, with the number of people between the ages of 18-24 in active employment dropping by 146,000 over the duration of the crisis.
Gerwyn Davies, economist at the CIPD organisation for HR professionals, said: “The real concern is the very sharp decline in employment of young people at a time when a new cohort of college and university leavers are looking for jobs."
Many economists predict that jobs losses will continue to increase over the coming months, set to increase now that the governments wage support services are being phased out.
The government has warned that they will not keep workers in "suspended animation" by extending wage support. Chancellor Rishi Sunak, in response to the ONS's predictions, announced that "protecting jobs and getting people back into work" remains his number one priority.
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