Redundancies hit record high as hundreds of thousands lose jobs

More people were made redundant between July and September than at any point on record, according to new official statistics. It comes as the pandemic laid waste to large parts of the economy.

Hard times

Around 314,000 redundancies were registered during the three months according to the Office for National Statistics (ONS). This figure is up by 181,000 from the quarter before. The data suggests that unemployment in the UK reached 4.8% in the three months to September. It’s an increase of 0.7 percentage points on the quarter before, and 0.9 percentage points from a year ago.

Meanwhile, around 33,000 people were dropped from payrolls in October. This has added to the 782,000 reduction in payrolls since March this year, when the pandemic struck.

ONS deputy national statistician for economic statistics Jonathan Athow said:

The latest monthly tax numbers show over three quarters of a million fewer employees on the payroll in October than in March.

Unemployment grew sharply in the three months to September, with many of those who lost their jobs earlier in the pandemic beginning to look for work again. The number of redundancies has also reached a record high.

Vacancies continued to recover from the very low numbers seen earlier in the year. However, these figures predate the reintroduction of restrictions in many parts of the UK.

Second lockdown

Since the figures were taken, several parts of the country have re-entered various stages of lockdown, including severe restrictions in England, which were put in place last week.

Our latest labour market statistics have been published for the period July to September 2020 https://t.co/EaXPo7Rbpo pic.twitter.com/k6XhUfDxOy

— Office for National Statistics (ONS) (@ONS) November 10, 2020

As a result, the government decided to extend its furlough scheme until March next year, ensuring that employees who can’t work will get up to 80% of their salaries.

Suren Thiru, the head of economics at the British Chambers of Commerce, said:

While there was a rise in the number of job vacancies, this is more likely to reflect a temporary bounce as the economy reopened before recent restrictions were reintroduced, rather than a meaningful upturn in demand for labour.

The extension to the furlough scheme will safeguard a significant number of jobs in the near term. However, with firms facing another wave of severely diminished cashflow and revenue and with gaps in Government support persisting, further substantial rises in unemployment remain likely in the coming months.

He called for more grants for businesses that have been hurt by restrictions. And he asked the government to ensure that it closes gaps in its support schemes, including for unemployed people.