Six percent of the UK workforce remains on full or partial furlough according to the latest figures from the Office for National Statistics, with the Coronavirus Job Retention Scheme on the cusp of its final week.
The figures led one analyst to warn the government that many people would face difficulties this autumn once the scheme closed and urged it not to press ahead with the cut in Universal Credit.
Although the ONS found that the proportion of businesses’ workforce on full or partial furlough was broadly unchanged from late July to mid-August 2021, at 6%; about one in six (16%) of the workforce in “other service activities” occupations, for example, hairdressing and other beauty treatment businesses, were using the CJRS.
However, this had declined from a high of 79% in late January 2021.
Of the workforce who are reported to be on furlough, about two-fifths (43%) are still fully furloughed, equating to about 600,000 people, the figures suggest.
Responding to the ONS Business Insights and Conditions Survey, independent think-tank the Resolution Foundation has calculated that about one million employees will still be on furlough on 30 September, when the scheme closes, and will face a “testing autumn”.
Furlough and redundancy
The Foundation predicts that although most workers still on furlough would return to their previous jobs, particularly those on partial furlough, there would still be hundreds of thousands of workers needing to find new jobs in October.
Facing the most difficulties when it came to searching for work were older employees, said the Foundation. Older people were most likely to still be on the furlough scheme, and may have to resort to early retirement if they could not find work, it said.
Dan Tomlinson, senior economist at the Resolution Foundation, said the data vindicated the government’s decision to have extended the CJRS for 18 months to limit unemployment during the pandemic, adding: “The furlough scheme has been a living standards lifeline during the pandemic.”
He said that in the circumstances the government decision to cut Universal Credit was wrong.
“The fact that 1.4 million employees were still on the scheme just one month before it closes shows that our labour market is still far from full-health.
“The end of furlough is set to prompt a testing period in the labour market as even more people, particularly older workers, look for new jobs. This is another reason not to press ahead with the cut to Universal Credit.”