UK unemployment set to hit SIX million by May due to ‘horrendous’ coronavirus impact on jobs
MORE than six million Brits could find themselves unemployed by the end of May due to a "horrendous" coronavirus impact on jobs, according to research.
It means 20 per cent of Brits will be without a job - five times the current rate of 3.9 per cent.
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This represents a rise of around 5million people, up from 1.34million at present, according to research by Professor David Bell of the University of Stirling and Professor David Blanchflower of Dartmouth College on behalf of the National Institute of Economic and Social Research (NIESR).
The research institute estimates that more than half of employees in jobs most vulnerable to the coronavirus pandemic will be furloughed or made redundant.
Coronavirus has hit many industries hard, including travel and hospitality, with 185,000 firms applying for the government's furlough scheme to pay 1.3million staff wages in the first day alone.
It comes as Britain was warned of up to 2million job losses caused by the coronavirus lockdown last week.
The grim new figures assume that furloughed workers will count as unemployed, although official statistics may describe them as employed but not working, they said.
'Horrendous'
Mr Bell and Mr Blanchflower, who's also a former member of the Bank of England’s Monetary Policy Committee, said that some of these workers will be furloughed and may return to work, but only if and when there is a recovery.
This requires their companies to still be trading and have a market to sell into.
The two labour market experts added: "This becomes a tougher call the longer the lockdown persists.
"In short: unemployment is set to rise in the UK by a lot. What is coming in the labour market looks horrendous."
The findings, which will be published in the NIESR's National Institute Economic Review next week, tracks the changes in the UK and US labour market that have occurred since the beginning of March.
The research concludes that we should expect a collapse 20 times faster and much deeper than the financial crash in 2008/2009.
Mr Bell and Mr Blanchflower added: "This evidence suggests that the US and UK labour markets are experiencing an unprecedented fall in demand that will have an immediate, negative effect on the experience of those already in the labour market, those seeking to join it, and their households."
Your rights if you're made redundant
IF you're being made redundant, you may be eligible for the below, according to GOV.UK.
- Redundancy pay: If you've been working for your current employer for at least two years, you're usually entitled to a statutory redundancy pay.
- A notice period: According to redundancy law, you’re entitled to a minimum notice period of 12 weeks if employed for 12 years or more, at least one week’s notice if you have been employed between one month and two years, or one week’s notice for each year if employed between two and 12 years. If your employer doesn’t want you to work your notice period they can offer you a lump sum instead.
- A consultation with your employer: Employers always have to consult with employees before dismissing them on the grounds of redundancy. In short, your employer must tell you what’s going on and give you a chance to ask questions and raise objections.
- The option to move into a different job: Your employer might offer you "suitable alternative employment" within your organisation or an associated company. Keep in mind that you may lose your right to statutory redundancy pay if you unreasonably turn it down.
- Time off to find a new job: If you’ve been continuously employed for two years, you could be given a reasonable amount of time off to look for another job or to arrange training to help you find another job.
- Contact your Jobcentre: If you're struggling to find a new job, you can contact your local Jobcentre and ask for their Rapid Response Service - they specialise in helping people who've been made redundant. You can use the service during your notice period and for up to 13 weeks after you’ve been made redundant.
Meanwhile, Jeremy Thomson Cook, chief economist at currency firm Equals, told The Sun: "Movements in jobs markets and the level of support from governments eliminate any doubts that this crisis represents a type of recession unlike anything that has been seen before.
"Typically businesses react cautiously to a slowing economy; cutting staff and wages slowly so as to maintain operations at a sustainable level whilst cutting costs.
";In this instance however, the economy has not slowed but instead has hit a wall.
"This crisis will expose the holes in the labour market that have been largely ignored in recent times given a low headline rate of employment.
"We will see income disparity, skills shortages and weak productivity all increase the longer this crisis lasts, a recipe for a slower and more uneven recovery."
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A couple of days ago, the Office for the National Statistics (ONS) revealed that unemployment rose by 22,000 workers to 1.36million in the three months to February - before the coronavirus crisis hit the UK.
Meanwhile, the lockdown is pushing the UK into the biggest economic slowdown on record.
Earlier this month, experts predicted that a three-month lockdown could result in a 35 per cent fall of GDP.