Covid and Jobs in UK – 9 per cent of those previously furloughed had lost their jobs

This report presents new evidence on the effects of the coronavirus crisis on workers. It uses the results of a new survey of 6,000 working-age adults to highlight which groups have struggled the most as the crisis has evolved, who is at risk as the Coronavirus Job Retention Scheme is replaced by the Job Support Scheme, and the prospects for the future.

We find that while there have been significant improvements in the levels of labour market activity since the height of the lockdown, unemployment is now on the rise. Even among those still in work, many have lost pay and hours, and the impact has been worst in London and in more deprived areas of the country. There is little evidence that workers are reallocating into the sectors that have been more protected from the economic hit caused by the pandemic, and respondents reveal worrying signs of redundancies to come.

With the labour market crisis likely to accelerate over the winter as restrictions tighten and support becomes less generous, policy makers should aim to protect the incomes of those most affected, limit the rise in unemployment, and enable people to play their part in suppressing the virus. This should include extending eligibility for the full furlough version of the Job Support Scheme, investing in job creation, keeping the £1,000 a year benefit uplift, and improving the financial incentives to self-isolate.

Key findings

  • While more than half of those furloughed during lockdown had returned to work by September, 9 per cent of those previously furloughed had lost their jobs. This rate was highest for 18-24-year-olds, Black, Asian and minority ethnic workers, and the low paid.
    The employment effects of the crisis have borne down particularly hard on London, as well as those in the most deprived areas of the country.
  • Of those respondents who were still employed by September, 12 per cent reported being paid less than they were in February. Pay reductions were more common in hard-hit sectors and (to a lesser extent) among younger workers, though pay cuts have become more evenly distributed as the crisis has evolved.
  • In every month since April, more than half of self-employed workers were receiving lower earnings than before the crisis. Support has been poorly targeted, however: one-in-six respondents who claimed a Government grant did so despite having experienced no loss in income, while close to 500,000 self-employed workers still without work in September had received no support.
  • Nearly one-in-ten respondents who were in work in February spent some time out of work between March and September, of whom fewer than half had found a new job by September.
  • There is little sign that workers are reallocating to less-affected sectors of the economy: people who previously worked in hospitality, leisure, or non-food retail are most likely to be looking for a new job in one of those same sectors or administrative positions. More than a quarter of respondents in work in September are worried about redundancies occurring, have been told a redundancy process either may or will happen, or have been told they will be made redundant.

Chosen excerpts by Job Market Monitor. Read the whole story @ Jobs, jobs, jobs • Resolution Foundation


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