Alarm over rising jobless
Third of firms to shed staff before job scheme ends
Job losses could rise sharply
Almost a third of businesses expect to cut jobs in the next three months before the government’s Job Retention Scheme ends, according to alarming new evidence that unemployment could rocket.
The 29% of firms that expect to reduce their workforce is the highest on record. Of the balance, 59% will keep headcount the same and just 12% will look to increase their payroll.
Four in ten (41%) SMEs and large firms said they would layoff staff.
The survey, by the British Chambers of Commerce and Totaljobs, reinforced data from the BCC’s Quarterly Economic Survey of the challenging environment business communities across the UK are facing.
It shows record falls in key indicators of business activity, including domestic and export sales, cashflow and investment.
Only one in four firms attempted to hire staff in the last quarter, while 65% faced recruitment difficulties, particularly for skilled manual/technical or managerial roles.
As lockdown lifts, Totaljobs has seen a 30% month-on-month increase in the number of jobs being advertised on its website for June, with the largest volume posted in IT (20k), logistics (12k) and social care (9k).
There were also month on month increases in sectors benefiting from lockdown easing like retail (+51%), travel (+47%) and hospitality (+23%). Skilled trades also started to see growth compared with previous weeks, with jobs advertised increasing by 57%.
Unsurprisingly, applications per vacancy were up across all sectors, reflecting continued rises in candidate activity on the Totaljobs site.
The two organisations have called on the government for further action to limit the damage to the UK labour market, including reducing the overall cost of employment, through a temporary cut in employer National Insurance Contributions and support to upskill and reskill employees as businesses adapt to change.
Jobless tally mounts
Unemployment in Scotland stood at 4.3% over the quarter, according to the latest official labour market statistics published by ONS.
The UK unemployment rate remained at 3.9% in the March to May period, with 649,000 fewer individuals on payrolls.
Scotland’s Economy Secretary Fiona Hyslop said the figures do not reflect the full picture of the labour market as the Job Retention Scheme will have offered some relief to many employers and employees.
“The Job Retention Scheme will end in October but we believe the UK Government must extend the scheme, particularly for sectors that have been most affected by COVID-19.
“We have committed a further £100 million for employability and training support. This will help anyone who has lost their job or is at risk of losing their job, as well as those looking for work.”