With the furlough scheme drawing to a close today (30 September) there are fears that almost one million staff still on the scheme at the end of September could fall into unemployment.
Business groups and unions have warned that thousands of employees could face redundancy with the withdrawal of the scheme, with the over-50s and those in the hardest-hit sectors thought to be most at risk of job losses.
Since the Coronavirus Job Retention Scheme (CJRS) was introduced during the first national lockdown in 2020, it has helped employers retain 11.6 million workers while swathes of the economy were shut down.
But the Office for National Statistics estimated that around one million jobs were still being protected by the scheme this month.
The Liberal Democrats have called for a six-month extension to the CJRS for the 10 sectors that have suffered most during the pandemic. The party claims that 51% of people in air passenger transport, 46% in the travel agency sector, 35% in photography and 28% in arts and entertainment were still on furlough.
Furlough
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Unemployment warning for this autumn as furlough scheme winds up
Christine Jardine, the party’s Treasury spokesperson, said: “The withdrawal of furlough risks having a devastating impact on countless families already facing a winter of soaring energy bills. The government needs to rethink its approach or the country could face a Coronavirus Black Thursday.
“Thousands of people relying on furlough are worrying about their livelihoods at a time when the impact of the pandemic is far from over. Supporting them and their families is both the right and responsible thing to do.”
Unlikely to find work quickly
Despite a record number of job vacancies and the economy growing 5.5% between April and June 2021, according to the ONS, JourneyHR co-founder Aliya Vigor-Robertson noted that those who lost their jobs over the coming weeks would be unlikely to more into a new role quickly.
“Vacancies are also currently clustered in certain industries, such as logistics and hospitality, meaning many will delay their return to the workplace until they can find a job that matches their skillset or wage expectations. Those willing to retrain will also need time to do so and therefore won’t contribute to a rapid influx of skilled workers,” she said.
City & Guilds suggested that the over-50s would be disproportionately affected by job losses. “Safety nets” have been put in place to protect younger workers from long-term unemployment, such as the government’s Kickstart scheme, but similar opportunities do not exist for older workers, said CEO Kirstie Donnelly.
Those willing to retrain will also need time to do so and therefore won’t contribute to a rapid influx of skilled workers” –Aliya Vigor-Robertson, JourneyHR
“Workers over the age of 50 represent a third of our workforce, and have a wealth of knowledge, skills, and experience that could be used to fill vital roles in society in the years ahead. However, with data highlighting that these workers are most at risk of losing their jobs and with many already struggling to re-enter the workplace, urgent action is needed to ensure we don’t throw a generation of older workers on the scrapheap when they still have much to contribute,” she said.
“Our recent Skills Index research paints a clear picture of chronic under-investment in training older, more experienced workers. Therefore, we need both employers and government to recognise the value and potential of these workers and give them the right opportunities to update their skills.”
Restructuring
Some employers might consider restructuring over the coming weeks. James Townsend, a partner at law firm Howard Kennedy, said fairness and following the correct procedures would be essential to avoid being taken to an employment tribunal.
“A key area for employers to remember is that if they are considering making more than 20 redundancies at one establishment within 90 days, employers are obliged to collectively consult with appropriate representatives for at least 30 days (essentially on ways of avoiding redundancies) before the first dismissal,” he added.
A key area for employers to remember is that if they are considering making more than 20 redundancies at one establishment within 90 days, employers are obliged to collectively consult with appropriate representatives for at least 30 days” – James Townsend, Howard Kennedy
Vigor-Robertson said organisations should also consider how they support employees who remain. “Those planning redundancies can also take steps to ensure that ‘survivor’s guilt’ or ‘sinking ship syndrome’ do not sap the morale of their remaining team members or usher in a wave of resignations. Increased mental wellbeing support and redeploying or retraining remaining team members will be vital to this.”
However, CV-Library survey found the majority of professionals (63.6%) are unlikely to be affected by the closure of the CJRS. Their top concerns in relation to the scheme closuring included worries about their workload increasing and colleagues leaving.
Travel sector needs more help
Unite urged the government to introduce measures to protect jobs in the aviation sector in particular. Assistant general secretary for aviation, Diana Holland, said the sector is “very far from” its pre-pandemic passenger levels and its immediate future is very uncertain.
“Thousands of jobs have gone and many more now hang in the balance. Adapting furlough would provide support for these workers in the coming months as the sector seeks to recover,” said Holland.
“We are only asking for the same support that our competitor countries are providing to their aviation sectors. The UK government is allowing our sector to be placed at a huge disadvantage when it should be giving it a helping hand through these difficult months.”
The TSSA union, which represents travel trade companies, also urged the government to create a bespoke package of support for the sector. General secretary Manuel Cortes said: “Travel companies have struggled through two summers of restrictions on travel, whilst the government has ignored our calls for extra assistance. Now, everyone in travel trade will be paying for the lack of support from government.
“Eurostar, and their ancillary industries, are particularly badly hit, as disgracefully the government has refused to give them the same bailout they gave to other train companies in Britain.
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“Sadly, faced with a steep increase in wage bills from 1 October and no return to normal, travel companies will make savings to staffing costs in other ways just to save their business. This will inevitably mean redundancies in the run-up to Christmas, whilst other workers will be forced to pay for saving their jobs by accepting cuts to their hours, and a bonfire of their terms and conditions.”
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