Covid jobs bloodbath as number of people employed falls by 730,000 since lockdown with benefits claims hitting 2.7million – despite furlough scheme propping up millions of roles
- Some 730,000 fewer people were employed last month compared to March
- ONS found the number on payroll fell another 114,000 between June and July
- Numbers claiming benefits increased again last month to reach 2.7million
The number of people employed fell by another 114,000 last month as coronavirus hammered the jobs market.
Some 730,000 fewer people are now on the payroll than in March before the country went into lockdown to combat the killer disease.
Meanwhile, the claimant count increased again in July 2020 to reach 2.7million.
In the three months to June, the number in jobs decreased by 220,000 – the largest quarterly decrease since 2009.
However, the full impact of the lockdown has so far been masked by the massive support schemes including furlough, which has propped up more than nine million jobs.
ONS economist Jonathan Athow said: ‘The labour market continues recent trends, with a fall in employment and significantly reduced hours of work as many people are furloughed.
Some 730,000 fewer people are now on the payroll than in March before the country went into lockdown to combat the killer disease
‘Figures from our main survey show there has been a rise in people without a job and not looking for one, though wanting to work. In addition, there are still a large number of people who say they are working no hours and getting zero pay.
‘The falls in employment are greatest among the youngest and oldest workers, along with those in lower-skilled jobs.
‘Vacancies numbers began to recover in July, especially in small businesses and sectors such as hospitality, but demand for workers remains depressed.’
Fears are mounting of a ‘bonfire of jobs’ amid warnings a third of firms are planning to lay off staff this autumn.
Many of the cuts are set to come from hospitality businesses such as hotels, restaurants and cafes, as well as shops that were already on the brink before the pandemic.
The hit emerged in a survey carried out by the Chartered Institute of Personnel and Development (CIPD) with recruiter the Adecco Group.
The Bank of England predicted last week that unemployment will rise by a million by the end of the year.
Labour has been demanding the government ditches plans to scrap the furlough scheme entirely from October, forcing employers to take on the full costs of staff wages again.
Meanwhile, figures released this week are due to confirm that the UK has formally entered recession – with a second quarter of GDP contracting.
The Bank of England’s latest forecast says the economy will shrink by 9.5 per cent this year, making it the worst downturn in a century.
GDP figures due to be released this week are set to show that the UK has entered a technical recession – with two consecutive quarters of contraction. The Bank of England predicts that the downturn will be the worst in a hundred years (chart pictured)