On Tuesday it was announced that the UK’s unemployment rate rose to 4.8% in the three months to September – which is up from 4.5% in the previous quarter.
The Office for National Statistics (ONS) has again placed the blame largely on the coronavirus pandemic, as it has continued to impact the jobs market across almost every sector.
Also, redundancies across the UK rose to a record high of 314,000 in the same period and the number of people out of work rose by 243,000 in the three-month period. Both of these figures are the largest increases since May 2009.
Following, the announcement, Chancellor Rishi Sunak said: “I know that this is a tough time for those who have sadly already lost their jobs, and I want to reassure anyone that is worried about the coming winter months that we will continue to support those affected and protect the lives and livelihoods of people across this country.”
Rob Marshall, managing director of employee benefits platform, WorkLife, comments: “More than three quarters of a million people have lost their jobs between March, when the first lockdown began, and October. The record number of 314,000 redundancies means that many of these jobs will be lost for good.
“These figures show the terrible toll the Coronavirus pandemic has had on Britain’s workers. And while news of a possible vaccine has injected some optimism into the outlook, this doesn’t provide new jobs in the short-term.
“While there is still so much uncertainty in the economy, we need to redouble efforts to support those employees still in work and the businesses employing them. Employers can help by offering financial and mental well-being support to their workers, many of whom will feel anxiety over continued job security in the face of fresh lockdowns across the UK.”
Douglas Grant, Director of Conister, said: “The relatively low increase in unemployment over Q3 shows that the Government’s furlough scheme has been successful in mitigating some of the potential fallout from the COVID-19 pandemic. However, with redundancies reaching a record high over this period, it is clear that while the furlough scheme has been instrumental keeping many SMEs alive, not all businesses can or will be saved. The latest lockdown measures in England will sadly be the last nail in the coffin for many companies which simply cannot receive capital quickly enough. We are therefore determined and absolutely focussed on protecting those robust businesses operating in sectors that are resilient and ultimately will grow stronger with the necessary capital in the long term.
“We consistently support the Government’s financial assistance for businesses and would urge continued collaboration with alternative and traditional lenders to identify and protect the more resilient sectors of the economy, ensuring their existence is guaranteed.”
Jonathan Boys, CIPD Labour Market Economist comments:
“A modest recovery in hours worked reflects the summer reopening when large numbers of people gradually moved off furlough. Some sectors were able to make hay while the sun shone, but we now know coronavirus cases were rising. Furlough helped to limit jobs losses and protected incomes, and it is therefore right that the Government has extended it until the end of March – especially in light of promising news on a vaccine. This will boost business confidence and help stabilise employment through to the spring. Businesses now have a scheme that they understand and a reasonable timeframe in which to conduct workforce planning.
“However, unemployment rose sharply this quarter and redundancies increased by a record number. The CIPD’s latest forward-looking Labour Market Outlook report suggests that redundancy activity will remain high in the three months to December and could therefore surpass the total number experienced after the financial crash. The economic pain of the pandemic has been cushioned by furlough and other government support schemes but will start to increase over the winter. We believe the Government needs to do more to help people upskill and reskill beyond what’s been outlined in the Kickstart scheme and Lifetime Skills Guarantee. This includes reforming the Apprenticeship Levy and increasing access to lifelong learning.”
Jeremy Thomson Cook, Chief Economist at Equals Money: “With the furlough scheme now extended until the end of March, the labour market has once again been put back to sleep by the Chancellor preventing a rude awakening as we head into winter. Unfortunately, a record level of 341,000 redundancies in the past few months show that for many people the additional government support came too late to save their roles. These figures will do nothing to alleviate fears that the UK is headed for a double-dip recession should lockdowns continue.”
“The key test will now be how many of those workers are re-employed or find different work as this lockdown comes to an end. In the short term however, we would suspect businesses are likely to increase hours for current workers first before taking on the costs of additional staff.”