United Kingdom loses 700000 jobs to pandemic as pressure mounts for aid

15 Septembre, 2020, 16:37 | Auteur: Auguste Feret

Unemployment in the United Kingdom edged up in July even though large sections of the economy reopened after the coronavirus lockdown, a signal that the jobless rate is set to spike higher when a government salary-support scheme ends in the autumn.

Statistics from the Office for National Statistics shows that the unemployment rate for people aged 16 and over increased to 4.6% (128,000) over that period, a 0.1% increase on the previous quarter.

Early indicators for august 2020 suggest that the number of employees in the United Kingdom on payrolls was down around 695,000 compared with March 2020.

The national claimant count in August was 2.72m - up 2.8 per cent on the month and 102.8 per cent (1.5m) since March. It is 6.5 per cent of the working population.

Shropshire had a rise of 75 claimants to 9,155 (4.8 per cent) with Telford and Wrekin up by 205 to 7,315 (6.5 per cent).

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"The furlough scheme has been very effective in cushioning the blow from the pandemic to the labour market", said Debapratim De, senior economist at Deloitte. The reopening of key sectors in the economy meant many people - thought to be around 2 million - could return to work following months at home.

"Easing of lockdown restrictions and a more flexible JRS in July have led to signs of stabilisation in vacancies and hours worked", said director Ian Price.

"But across the United Kingdom, rising redundancies, creeping unemployment and a record fall in the number of young people in work are clear warning signs".

The Bank of England has forecast that the unemployment rate will hit 7.5% So, more pain is expected for the GBP ahead and expect sellers on rallies unless some great Brexit news trumps all the bearish economic data.

After Northern Ireland, Wales had the second highest rate of economic inactivity at 22.9%, up 0.6 percentage points on a year ago. "This should include a significant cut in employer National Insurance contributions and more substantial support for firms placed under local lockdowns".

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